It’s not how much you earn, but what you do with what you earn
Two people may have the same dispensable income but one will retire comfortable (even wealty) and the other a pauper. How is this possible? In most cases, the successful person focuses on his assets and the unsuccessful one on his liabilities. An asset is anything that create cash flow. Successful people channel some of their money into assets – perhaps a little at first, but as the asset starts creating its own money, a portion of this goes into new assets. Perhaps the best and most achievable example is rental property. As long as you have a good credit rating and common sense, you may benefit from this asset class. See more details here
The rich buy luxuries last, while the poor and middle classes buy luxuries first
Successful people use their income to buy assets, and the money created from these assets may be used for luxuries. Most people limit their income potential by using their income to buy jewellery, expensive cars, etc. A small minority don’t – they live in moderation, investing in assets. Only when the assets start bearing fruit do they treat themselves, using the money created by their assets. They are the ones who become wealthy.
Money is the seed of money, and the first guinea is sometimes more difficult to acquire than the second million
(Jean Jacques Rousseau)
The saying goes that if your idea can make a guinea, it can make a million. Some of the most successful businesses started small, without a monetary goal (Google, Facebook and Tuenti are good examples) but it turned out to be essential to thousands of people – and then to millions. The lesson here is to offer a useful service or product, get it right (earn a guinea) and then hone it into a money making machine, step by step – rather than jumping after arbitrary money making schemes.