Where do you sit on the Wealth Pyramid?
Most people say wealth means a big salary with a lifestyle to match.
Most people equate wealth to money, but that’s not how wealth works.
You need a lot more that money to be truly wealthy.
You need your health, your friends and family to share it with, you need personal growth, spirituality (this means different things to different people) and contribution.
As you can see, to me wealth is a product of the mind and no amount of money will make you wealthy.
To be truly wealthy you have to be grateful for what you have in life and you have to be living a life where you know you are contributing or giving back.
Financial independence is different to wealth
It means you never have to work again to live your life.
That’s what you’re really investing for, isn’t it?
My suggestion is that you should be committed to being wealthy as well as financially independent.
Just to make things clear… income by itself does not make you financially free.
In fact income is one of the worst predictors of financial freedom.
You spend some, maybe you save some, and taxation takes away a portion of it.
Most people in Australia never become wealthy; they never develop real financial independence.
For most people the bills keep mounting up and despite working more and more hours they can’t make ends meet.
So it’s not really income you are after
To secure your financial future you need to acquire assets that grow in value and bring in passive recurring income.
Having dealt with Australians from all walks of life I’ve developed a number of models to explain the progression most investors take in their path to developing financial freedom.
These models allow you to know exactly where you are heading financially, what stage you are at along the way, and what the key focus areas and leverage points are that you can use to fast track your journey.
Let’s look at what I call…
The Wealth Pyramid
My financial model — the Wealth Pyramid — shows what level you are at on your way to financial independence and what the key focus areas and leverage points are along the way to speed you on your journey.
Like all pyramids it has a wide base and tapers towards the top, in other words most people are at the lower levels of the wealth spectrum and fewer reach the top.
Hopefully the knowledge and skills you’ll learn from blogs like this, my books and my podcasts will help you work your way up the pyramid, but the solutions you’ll need to move from one level to the next will vary depending where you are.
Unfortunately, most people don’t really have any wealth and therefore are at…
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