Why Does the Poor Keep Getting Broker and Broker,
and the Middle Class Keep Getting Deeper and Deeper Into Debt,
While the Rich Keep Getting Richer and Richer?
by Kevin Farmer
The answer to that question is quite simple.
The difference between the poor, middle calls and the rich, are their buying habits.
How do the poor or broke people spend their money?
Now these are those people who live paycheck to paycheck
or even those who run out of their paycheck before their next paycheck.
Poor or broke people buy stuff.
These would be things that people buy that they do not really need to survive.
You go into their home and you can't find any counter tops or tabletop space in the whole house.
Because of all the stuff all over the home.
Their house and their cars are full of stuff
Where do they get all this stuff?
They get this stuff, week after week, paycheck after paycheck,
at the Flee Market, at the garage sale, at the dollar store, and so on.
So. over the years they fill and clutter their homes with STUFF.
Creating wealth for ones self, no matter if your poor or not, is not a mystery, it's a formula.
This information has been around for 1,000's of years.
The problem in our day and time is we are not taught this from hour parents, nor in our schools.
As a matter of fact we are educated, in our schools (including our colleges and universities),
on how to be employees or professionals, earing a paycheck.
We are not educated on how to have money work for you,
instead we learn, in our schools, how to work hard for money, as EMPLOYEES or PROFESSIONALS!
How the Middle Class Spend their Money
In our society today, mistakenly looks at the Middle Class as being rich, instead it is nothing but a facade.
The Middle Class even earn a six figure annual income,
but as we shall see, it's what they buy with their money that keeps them prisoners.
What the Middle Class buy are BIG TICKET ITEMS in order to keep up with the Jones'
Things like a home, cars, boats, plans, credit card debt etc.
In other words the Middle Class buy LIABILITIES!
What is a liability?
Any thing that takes money out of your pocket.
So as time goes by with the Middle Class, and trying to keep up with the Jones'
and impress family and friends, they continue to buy more and bigger things using credit card dept
and soon their debt is greater than their total income.
So they put themselves in a worse place than the poor,
and they create stress in their lives, that become so unbearable.
So what does this mean to both the Middle Class and the Poor?
It means all of their income is totally dependent on their own efforts.
It also means they educated themselves for their knowledge and expertise (or time),
for someone else's money.
The money they earn is usually the highest tax form of income.
You must also realize that both the Poor and Middle Class spend their money on LIABILITIES!
What is the definition of a liability?
Anything that takes money out of your pocket.
How the Rich Spend their Money
First don't get me wrong, the rich buy stuff and they even buy big ticket items,
But their is one thing the Rich buy that the Poor or Middle Class DO NOT BUY!
The Rich Buy Assets!
An asset is anything that puts money into your pocket.
They buy stocks, bonds, big business, they buy commodities, precious metals.
They buy Networks, they buy network news papers, network TV stations,
network radio stations, and they list goes on.
So this is what we have learned so far, the...
- Poor buy Stuff...
- The Middle Class buy Big Ticket Items.
- The Rich buy Assets
Now let's examen two types of income.
Linear Income vs Leveraged Income
Linear income means you trade time for money, or trade hours for dollars.
It doesn't matter whether you're a
grave digger, making $5 and hour.
Or a surgeon earning $100,000 an hour.
Now the surgeon has learned high paying medical skills to earn even a six figure hourly income,
While the grave digger has never never learned a skill or has learned a very low paying hourly skills.
Even though the surgeon is earning a much better hourly wage than the grave digger,
they are both trading hours for dollars.
If the surgeon or the grave digger DOES NOT WORK, they DO NOT GET PAID!
We all have only 24 hours to work in a day, and the surgeon has learned greater skills that pays him or her well.
While the grave digger HAS NOT learned any skills or low paying skills.
So if we all have only 24 hours a day, then we must lean a better way to earn and income.
and the wealthy have learned a different set of skills.
They have learned to leverage their time and money!
LEVERAGED INCOME is earning money through other people's efforts.
They wealthy have learned how to LEVERAGED their time and income through other people's efforts.
Or put it another way, using OPT, that stands for Other People Time,
or what we would call EMPLOYEES, providing the wealthy with massive wealth.
Now we are not talking about doctors, lawyers or any other type of profession, who hire an office staff.
No, we are talking about people who own a BIG BUSINESS, that is over 500 employees.
Another way the wealthy have learned to earn massive wealth is leveraging their money!
Or put it another way, they have learned how to have their money work hard for them instead of them working hard for money!
How, you might ask?
Let me tell you a story to help you understand.
There was a lady who only made $10 a week, (yes this is going back a few years),
but she and husband were living paycheck to paycheck.
One day she said told her husband, I am tired of living paycheck to paycheck.
So she decided to pay herself first, $1 (10%) each week and at the end of the month,
she word take her $4 (or $5 depending if was a four or five week month),
to a broker and invest that money in Mc Donald's.
Within ten years, she became financially free and today she is a multi millionaire.
This lady even though she was poor, learned how to live off of 90% of her income and took that 10% she paid herself first
and leverage her money, to the point that her money was now working for her,
instead of working hard for money as an employee.
So, which would you rather have, a linear or a leverage income?
I am sure you agree with me a leveraged income is far better and the only real way to earn money.
If you want to leverage your income, both with your time and money,
then connect with me Click Here.