“Its not about how much money you make, its about how much you keep.” – Rich Dad, Poor Dad
Just let that settle into your brain for a little bit. It makes you wonder about all the times you have spent that extra money you “earned” from your bonus or return check on frivolous things. Constantly finding yourself asking “what if?” with nothing to show in the long run can get pretty upsetting after awhile. We have all heard of the professional athletes that seem to swim in millions of dollars only to declare a chapter 7 bankruptcy 5 years later.
Where did the money go?
There is one thing that separates the rich from the poor more than anything else, and that is assets. The poor only acquire liabilities and the rich acquire assets. Its really that simple. The dwindling middle class (or whats left of it) THINK they acquire assets, but in reality they are just liabilities. Most people complicate what the terms asset and liability mean, and some may not even know what I am talking about. Simply put, assets put money in your pocket and liabilities take money out of your pocket. Having said that, if you have more money going into your pocket than going out, you will have more money in your pocket to acquire more assets.
To become rich you must have things that constantly make you money. Over time these will all compound. That is how the beauty of a dividend portfolio works or how a buy and hold real estate strategy operates. Time is your biggest and most precious asset. Don’t go and waste it.