Let’s talk about WEALTH!

What should my second post be? First thing that comes to mind…… WEALTH!!!   This site is all about wealth so lets talk about wealth!  Not that long ago the words ‘Rich’ and ‘Wealthy’ meant the same thing to me.  Now I consider them to be related but distinctly different.  You can be ‘Rich’ and not be ‘Wealthy.’  You can be ‘Wealthy’ and not be ‘Rich’.  You can also be ‘Wealthy’ and ‘Rich’!  So what is the difference? 

To me, the definition of being rich is: having a lot of money.  The definition of being wealthy is: having a lot of assets.   Money can buy you wealth.  Unfortunately when people get money they tend to buy things instead of wealth.  Why buy wealth with money?  Wealth generates money!  And you can use that newly generated money to buy more wealth.  And that new wealth will generate more money.  Wealth makes money, money buys wealth, wealth makes money, money buys wealth.. This never ending cycle will continue!!!  This is why the wealthy keep getting wealthier! 

On the other hand, when people have money and the decide NOT to buy wealth.  They will forever have to work for more money!  This is also a never ending cycle!  Work for money, get paid, spend money…. Work, get paid, spend.  Work, get paid, spend.  Sound familiar?  This is why so many professional athletes and lottery winners end up filling for bankruptcy!  Money never lasts, unless you purchase assets!  Since assets generate money, money can become sustainable and last or I should say be replenished! 

If you are ‘chasing’ money, then just know that it won’t last once you catch it!   Stop chasing money and start chasing wealth.   Some people might ‘look’ rich but you would be surprised how many people are living that lifestyle by using BAD debt!  These people who ‘look’ rich are actually living paycheck to paycheck!  If they loose their job they will loose everything and many do!…The debt finally catches up with them and then you wonder whatever happened to so-and-so?!?  On the flip side of the coin….lots of wealthy people do not look rich at all.  Many wealthy people choose to drive modest cars, dress casual, and keep silent about their wealth.  

What kind of assets are good to start building wealth? That answer depends on your situation and your net-worth.  If you have a high net-worth the most obvious answer is real estate and business.  If you have a low net-worth then precious metals and stocks might be a best.  If you have decent net-worth then maybe a mix of affordable real estate, businesses, stocks, crypto, and precious metals. 

Lets talk about the different asset classes.

-Real estate(RE): is by far the best asset that will generate passive income.  The downside to RE is that there are risks and it can cost a lot.  Loosing a tenant, maintenance, and even being sued!  As long as you can afford to cover these cost if/then they arise, then in the long term, RE is completely a great asset to own.

-Business: Owning a business CAN also generate as much if not more money than RE. If you have the experience to operate a business so it makes money, it can be very rewarding.   It can also destroy money if you are not experienced and educated on how to run a business properly. If you do not have the experience or knowledge to run a profitable business then you can always hire people who are capable of operating a profitable business, which will generate passive income since you will not need to spend your time there. You can also own just equity in a business which will provide passive income when the business is profitable. 

-Paper assets/electronic:  also known as stocks, bonds, and cryptocurrency are more common asset for most people.  Dividend stocks can provide passive income.  And bonds will provide income from interest. Mining cryptocurrencies could provide passive income but it requires a massive upfront investment and is very competitive. 

-Precious metals(PM) on the other hand do not provide interest or dividends.  Then why own PM?  PM are a different type of asset, they are not designed to grow your wealth but rather to preserve wealth.  PM tend to act as an insurance policy against your OTHER assets.  PM tend to rise in value when paper assets and real estate values drop.  And vice versa.   

-There are other types of assets, but the assets mentioned above are the most common and the assets you should start with before getting into the less known/popular assets.

In summary: Being rich is not the same as being wealthy.  When I was younger I wanted to be ‘rich’… but after chasing money for too long, I realized that I would rather be financially free than be rich but have to continue to work to keep up with the Joneses!  Once I realized that all a wealthy person is, is someone who has more revenue coming in versus expenses going out.  Which is not very difficult when you start buying assets!

P.S….  I had someone tell me that the word ‘Stacking’ has only one K!  Haha! I know but just so everyone else knows… I am a Stack King! Which is why this site is StackKingWealth.com!

Cheers!!

2 Responses to “Let’s talk about WEALTH!

  • Great content! Super high-quality! Keep it up! 🙂

  • Long time supporter, and thought I’d drop a comment.

    Your wordpress site is very sleek – hope you don’t mind me
    asking what theme you’re using? (and don’t mind if I
    steal it? :P)

    I just launched my site –also built in wordpress like yours– but the theme slows (!) the site down quite a bit.

    In case you have a minute, you can find it by searching for “royal cbd” on Google (would appreciate any feedback)
    – it’s still in the works.

    Keep up the good work– and hope you all take care of yourself during the coronavirus scare!

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