True Or False – High Income = High Wealth
Do you think making more money means having more wealth? Many people do because it seems logical that high income would translate to high wealth. This is not true!
Do you know people who make a lot of money from their business or their job but never seem to have any money? Or maybe they have money, a luxurious house and fancy toys, like expensive cars and boats, but they still have to go to work every day to make ends meet?
While these people have high income, they have very low wealth. When speaking with prospective clients or people at a seminar, I keep running into this situation and I always come to the same conclusion:
Making a lot of money has nothing to do with wealth.
Just this week, I was talking to a new client who runs a very successful business. He makes hundreds of thousands of dollars each year, but has more liabilities than he has assets. The reason seems to be that while he has made incredible efforts to make his business successful, he has never devoted the time or energy to learn how to make his investing successful.
This is not a criticism of this client. It is usually what we are taught.
We are often taught to work hard at our job or our business and to turn our finances over to a financial advisor who may or may not know what he or she is doing.
In addition, this client was given some poor advice regarding his250-311 taxes, so now he has to work even harder to pay back taxes that proper tax planning may have prevented.
Like our finances, we are often taught that taxes are too difficult so we need to “hand them over” to a tax advisor who may or may not know what he or she is doing.
In reality, you cannot “hand over” your taxes to a tax advisor. You have to learn enough of the rules to know when to go to your tax advisor for advice.
– Increasing Knowledge = Increasing Wealth –
The answer, no matter what your level of income or wealth, is the same. It takes knowledge to be financially (and tax) free. If you ask a highly successful millionaire or billionaireST0-050, they will tell you one of their essential secrets is possessing a diverse, cross section of knowledge in ALL areas of business. And they never stop learning!
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