What is Ultimate Wealth?

Many people have the wrong idea about wealth. So what is ultimate wealth? Ultimate wealth is when the income from your assets exceeds your expenses. It does not matter if you are only making 20,000 from your assets as long as your expenses are lower, then you are wealthy. If your expenses happened to be over the amount your of your income then you are not wealthy. That is basically it. So let's say Don is bringing in 5,000 a month from his commercial real estate and his expenses are 2,000 a month then Don is wealthy. Now let's saySam is bringing in 1 million a month in income from his assets but his expenses are 2 million a month he is not wealthy.

In the above example is where the majority of people get confused. Have you heard people say he must be rich because of the car, house or any number of other items a person may have.That is completely wrong. Those items are liabilities because they do not put money into the pocket of the owner.The next big myth is about the amount of money a person makes. This does not matter for two reasons. One what good is it to make 20 million a year if you are spending 40 million year, for example Mike Tyson. Next it depends on what type of income you are earning. If your only income stream is from your job you may be in trouble. The day of a job taking care of you is gone, this is a global economy. For instance, many baby boomers sold on the myth of going to school and getting a high paying job are finding themselves out of work and desperate for anyway to make ends meet each month. Your job cannot be considered a reliable stream of income because it is not. So when you hear someone say so"n"so makes this much a year. Dig more deeply is it income from a job or income from a business, real estate, and stocks because that makes a huge difference.

Ultimate Wealth is when the income from your assets (businesses,real estate, stocks) exceeds your expenses. Wealth is not a high paying job, it takes much more than having a high paying job to be wealthy. A good question to ask yourself is this "If I were unable for whatever reason to never work another day in my life, how long would I survive with my current lifestyle?" The answer to that question determines your ultimate wealth.

This article was written by Aaron Aldama. To build wealth visit:http://moneytalks23.blogspot.com/

 

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