You might use the words “wealthy” and “rich” interchangeably. While the two words mean to have a lot of money, they’re not the same. After reading this article, you might want to be one over the other. Here’s what you should know about being wealthy vs. being rich.
To be wealthy means to have money that lasts for more than a lifetime–literally! Some people have so much money that it can also set up future generations with wealth. This is why wealthy people are often considered “old money.”
To be rich means having a lot of money at a single time. For example, you’re rich if you win a million dollars from a game show. Being rich doesn’t set you up for life, though. Riches evaporate.
One major difference between wealthy and rich people is that they know how to make money last. They make sound financial decisions and typically don’t care about looking like their net worth. They don’t spend on typical things you would expect them to buy, like expensive bags and cars.
Rich people want to feel rich, so they pay for luxuries and aren’t usually concerned with maintaining their wealth. This is why you see lotto winners treating themselves to shopping sprees and luxuries. This is also why about 70% of lotto winners go broke.
Being wealthy and being rich aren’t polar opposites. Being rich is the first step to being wealthy. You first have to acquire a large amount of money before worrying about making it last. There are a few ways to get rich quickly, which you can read more about in the next section.
Most people consider someone “rich” if they have a net worth of about $1.9 million. Here are a few ways you can reach that number quickly.
Winning the lottery is how many people imagine themselves getting rich. After all, it doesn’t take much work–just an insane amount of luck. The current Powerball jackpot is at about $401 million, but the chances of winning the lottery are incredibly slim. You’d have a higher chance of getting struck by lightning than winning the Powerball!
Risky investments, like volatile stocks, tend to have huge rewards if you get lucky. However, they’re risky for a reason–there’s a chance you may lose money instead if you’re not careful. Whether you’re gambling on a stock or investing long-term, only invest money you’re willing to lose.
To become rich, you need a high-paying job or multiple income streams. You need to save more money to get rich. It’s always better to have both, though!
As mentioned previously, being rich is but a step to becoming wealthy. To set yourself and generations to come with money, you need to maintain your riches. The following are some ways for you to keep your money in the family.
Not taking risks means leaving potentially huge gains on the table. However, you have to make calculated risks, or ones you’re comfortable losing. This means investing, but only when you have all your needs met–and savings for a rainy day.
Investing early is a great way to retire early and create generational wealth. Don’t underestimate the power of compound interest–or interest on your interest. This value adds up over time, and you could be incredibly rich!
Wealthy people are intentional when it comes to spending money. They don’t make big purchases just because they want to. To become wealthy, you need to spend only on items you’re willing to spend. If you have trouble with being more intentional with your money, you have to…
It’s not enough to simply want money–you have to have a reason for it. For example, you may want to be wealthy to send your kids to the best schools in the future. Even the wealthiest people have long-term financial goals. Having one will help you stay on track when spending money.
There’s a reason that the wealthiest people in the world aren’t employees. If you have a vision for a business, you should make it happen. The worst thing that could happen is you fail–but you can always try again.
Not everyone is cut out to be a CEO of a multi-million dollar business–and that’s okay. It takes a lot of work to start your own business or get the highest seat at a company. You might not think it’s worth trading money for stress and time. However, if you want to be wealthy, you should push your career to be the best you can be.
Your network helps your net worth! To become wealthy, you need to surround yourself with like-minded people. This way, you can learn from each other and hold each other accountable on your financial journeys.
Another great way to learn is to join the money squad. As a member, you’ll get free financial advice every week. If you want in, all you have to do is click the link and sign up! It only takes a few seconds, but it’ll give you exclusive and potentially life-changing financial advice. So what’re you waiting for? Sign up today!
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Dollars Makes Cents by Shaquana, Financial Coach and Wealth Expert, resources helps professional millennial women of color with the tools and skills they need to eliminate their debt, amplify their savings, and build generational wealth — without having to compromise their lifestyle.
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