DECIDE ON YOUR DEFINITION OF WEALTH

So, what, to you, is wealth? This is one you can sit down and work out in advance if you are going to get wealthy.

My observations is that wealthy people invariably have worked this one out. They know exactly, what to them, wealth means.

I have a wealthy and extremely generous friends who says that he know long ago when he was starting out in business that he would consider he has made enough when he wasn’t living off the money he has amassed (which we will call his capital). No, he would consider himself wealthy when he was living on the interest on the interest of his capital. Sounds good to me.

Now this friend knows how much his interest on the interest is making him, pretty much by the hour. Thus if we all go out for a meal in the evening he knows:-

  1. How much the meal has cost
  2. How much he has made while eating the meal.

He says as long as (2) is more than (1), then he is happy.

This is setting the definition of wealth pretty high you might thing. Maybe you wouldn’t want to set it this high and that is fine of course. Then again, maybe you want to put some kind of figure on it. In the old days everyone want to be a millionaire. That was an easy one to judge if you’d got there or not. Today there are a lot of people who have houses worth more that what they wouldn’t consider themselves wealthy at all and yet haven’t quite got around to upping the ante to wishing themselves billionaires.

My own definition, for comparison, is having enough so that i don’t have to worry about having enough. How much is that? I never knew. there always seems to be more to worry about and less coming in. But seriously, I feel that I have been ‘comfortable’ since i started counting in thousand rather that in hundreds. I know to the nearest thousand how much I’ve got, how much i need and how much I can spend.

For some people, not worry might means having enough to pay any emergency that might arise in your family or home. So how will you define it? By the number of cars you? Servants? Cash in the bank? Value of your house? Portfolio of investment? There are, of course, no wright or wrong answers, but i feel until you have worked this one out, you shouldn’t read on. If we don’t have a target we can’t take aim. If we don’t have destination we can’t leave home or we’ll be driving around in circles for hours.If we don’t have a definition how can we monitor or judge success? If you don’t do this how will you know if this write up has been helpful to you?

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