At first glance, being rich and getting rich may seem like the same thing. But is there a difference between being rich and being rich?
Actually, there is a difference. In this article, we are sharing the difference between the two words. And the difference may surprise you.
What does it mean to be rich?
To be rich and to be rich may seem like one big thing. However, being truly wealthy is quite another, and, you may decide, is far more desirable.
have a high income
Rich people usually have high incomes. They are in the six-figure income range, or they may receive income from a trust or other source.
If you’re a wealthy person, you probably do things that help make you wealthy. You can work as a pilot, pharmacist or any other medical career.
Or you can work as a software engineer or do any other technology related job. Similarly, it could be that you and your spouse individually have mid-income range jobs, but together you make $150k or more.
In short, a rich person’s income is high enough that they don’t worry too much about money.
often have luxury items
Another sign that a person is rich is that they have luxurious stuff. A wealthy person probably drives a newer, higher-end vehicle.
They have expensive houses with expensive furnishings in their house. A wealthy person may have a second home, expensive vehicles or take lavish vacations.
You can tell a rich person by the fact that they wear expensive clothes, jewelry, and shoes. Or they may spend a lot of money on the food they eat, activities for their children, or items for their pets.
They may pay others for services such as extensive house cleaning, or hire a live-in housekeeper.
Rich people also think very short term. They are more interested in what they can and should do this day, this week, or this year.
They’re focused on the next vacation, buying a car, or the latest game or gadget. Rich people don’t think much about the future.
Instead, they have a YOLO (you only live once) mindset and plan and spend accordingly.
Lastly, rich people are self-centered. They are primarily concerned about what they want and need.
Their life decisions center around the answers to those questions. If they want a new vehicle, they get it. If they want to go on vacation, they go.
They take care of their wants before thinking about how their money can be used to influence a wider audience.
However, being rich is a completely different ball game.
what does it mean to be rich
Rich people live very different lifestyles than the wealthy. In fact, the lifestyle of a wealthy person is often the exact opposite of the lifestyle of a wealthy person.
One of my favorite books is The Millionaire Next Door by Thomas Stanley.
In it he said:
“Most of us want to be rich, but most of us do not spend the time, energy, and money necessary to increase our chances of realizing this goal.”
To help you on your way to wealth creation, here are some habits of rich people.
manage their income well
The income of rich people may or may not be high. However, they manage the money they earn very well.
Wealthy people often use a budget to help them manage their money. For example, zero-sum budgeting helps you make sure every dollar you earn has a job to do.
Rich people often work even harder to save money. They can use coupons to save money while shopping.
They are likely to have a set grocery budget and make sure to stick to their budget to help them save money on groceries.
Their goal is to limit wasteful spending. And one way to do that is to practice value-based spending.
Practice Value-Based Spending
Value-based spending is just spending your money on what matters most to you. For example, let’s say you have a goal of saving $20,000 over two years.
When you’re making decisions about your spending, a values-based spending mindset will help ensure that you make purchasing decisions accordingly.
For example, you have a long day at work and you really only want to eat out. A values-based spending mind knows it has two options:
- You can spend $60 to eat at your local bar and grill.
- You can go home, eat the leftovers, and put that $60 toward your savings goal.
Is reaching your savings goal more important to you than that spur-of-the-moment dinner? Only you can decide where spending that $60 will benefit you the most.
In contrast, the wealthy person won’t stop to think about a possible obstacle to a spending or savings goal.
The reason a rich person doesn’t stop to think about that expense is because, as discussed earlier, rich people think short term.
In contrast, rich people think long term. They consider how each expense will affect their long-term goals, whatever those goals may be.
Don’t worry; It’s not that rich people are devoid of fun or are morally opposed to the occasional dinner out.
it’s just that they have good control over their lack And Have long term goals. As such, they work to make spending decisions accordingly.
Last but not the least, where wealthy people are self-centered, wealthy people focus on others.
They make a habit of finding ways to give back. A wealthy person donates generously to charities that are close to his heart.
They often spend time volunteering for organizations they love. Wealthy people give generously of their time, money and resources.
They are generally not very concerned about making sure that they are granted their every wish. Instead, they view their wealth as a blessing to be used to help make the world a better place.
What is the main difference between rich vs. wealthy?
So, what is the main difference between rich vs wealthy? I guess you can sum it up by saying that rich people are consumers, while wealthy people are producers.
Rich people use their money to increase their personal consumption. Rich people use their wealth to produce positive results in themselves and those around them.
For example, a wealthy person may save their money so that they can start a business that will provide employment to people in their community.
Or they could fund a program to help single parents support their families or newly released incarcerated individuals get a fresh start.
The wealthy know that the allure of new and shiny things wears off quickly, and investing in the community can reap benefits for generations.
how to become rich
So how can you become rich? Believe it or not, you can start getting rich today, no matter what your current financial situation is.
Start by simply taking the four steps listed here.
Set your life and financial goals
The first step to becoming rich is to determine your life goals and your financial goals. What is it that you want from life?
what is your dream job? Your dream volunteer opportunity? Your dream retirement age? do you want to travel? If yes, where and with whom? Where would you like to live?
How big would your emergency fund be in your dream world? And do you need an emergency fund?
What other financial goals do you have? Why is money important? Why is it important to you to have more money?
Take a few hours a day and really think about what your life and financial goals are. If you have a partner, involve him in the process.
Once you’ve determined your goals, figure out step-by-step how to achieve them. Write the process down on a piece of paper or type it on a spreadsheet.
Then take the necessary steps to achieve each of your goals. And also note that it’s important to revisit your list of goals often.
Check-in quarterly with your goal sheet. make notes. Are you sticking to your plan? If not how?
And what can you do differently so that you can start sticking to your plan? Setting and achieving goals is a long process.
But years are going to pass whether you achieve your goals or not. So you can work on them too.
Save a specified percentage of each paycheck
Rich people always treat their savings like bills. They keep a percentage of their budget for savings every month and make the payments in the same way as utility bill payments.
Savings deposits are non-negotiable budget items like paying your electricity bill.
If you want to become rich then you also need to adopt the same mindset. Once you’ve determined your financial goals, you’ll want to have a line item in your budget for each of those goals.
When payday arrives, deposit those deposits each month into your savings goal accounts, just like you would with any other bill.
It can help you to have separate savings accounts for each of your financial goals. You may have one savings or investment account for early retirement and one you’ll use for your next vacation.
You may have separate accounts for your children’s college expenses, for an upcoming wedding or for the purchase of your next vehicle.
Whatever be your savings goals, make sure and make specified deposits every month in each fund.
Make it a non-negotiable rule and watch yourself get closer and closer to achieving your goals.
And above all, don’t use the money in your target accounts for anything other than the target, no matter how tempting it may be.
Pay off debt/Stay out of debt
Another way to get rich is to pay off all your debt. Yes, even “good” debt. Pay off your credit cards, car loans, student loans and even your mortgage.
Then, commit to staying out of debt. Buy only cars that you can afford with cash. Live within your means and stick to your budget.
I know paying off debt isn’t always easy. And for some the task may seem overwhelming.
Luckily, there are many great ways to pay off debt. In fact, Deacon Hayes, the founder of Well Kept Wallet, worked hard with his wife to pay off $52,000 in debt in just 18 months.
While the loan repayment process is different for everyone, you can choose from a number of loan repayment methods.
You can use the debt snowball, debt avalanche, or side hustle. You can use any one of the many apps to pay off the loan.
The key to becoming debt free is to make a plan and stick to the plan until you reach your goal. Stay on track no matter how hard it is to do so.
And if you do get off track, brush yourself off and get back on track, putting the accident in the past where it belongs. you got this!
Finally, if you want to be rich, be charitable. According to a study done by The Motley Fool, people with high generosity were 23% more satisfied with their lives overall.
Look for opportunities to give money to help others and you might be surprised by the positive impact it can really have on you.
Are you in the early stages of getting rich, and you have very little money to give? Then start by giving your time.
Find volunteer opportunities in your community. Help a local family that needs help. Lawn mowing for the elderly.
There are volunteer opportunities everywhere. Find them and use them to start your life of helping others.
If possible, give your money too. Start with a small amount and increase gradually if giving your money is inconvenient. I promise you’ll have all you need!
Can anyone become rich?
I firmly believe that almost anyone can become rich. do not believe me? Then check out this story about Ronald Reed, a janitor who died at age 92 with more than $8 million to his name.
How did Mr. Reed get so rich? By following the above mentioned tips. Slow and steady wins the race, my friends.
And if you are willing to put in the extra effort, you can go for the fast track as well. However you do it, don’t be afraid to aim high and reach your goals.