The same week the US Government shuts down, the Wall Street Journal and Federal Reserve report a rise in US household net worth fueled by gains in home and stock values.
The media says the economy is improving so you feel better and then go spend money that you don’t really have. Stop this! To understand how to build wealth you must understand principles and terminology. Then, when you hear, read, and watch news, you’re not hoodwinked.
When the Wall Street Journal reported this week that “U.S. Household net worth jumped $1.3 trillion in the spring fueled by gains in home and stock values,” and the Federal Reserve says “net worth rose to $74.8 trillion in the April-June quarter, up 1.8% from the first quarter,” you must dig deeper and know these facts. First, a home is never never never part of your net worth calculation. Net worth is not what you buy your groceries with and the Fed’s figures aren’t adjusted to factor in inflation or population growth. It’s hype. Don’t believe it.
Instead, I urge you to focus not on feeling good but, on building your own economy. Focus on wealth and don’t let the media machine sway you. The people who want to get wealthy do two things. They commit to getting wealthy and they take the time to study and understand wealth.
Want to start creating some wealth for you and your family? Do this:
- Focus on increasing income every chance you get. Cash flow is more important than net worth.
- Don’t spend money; save to invest.
- Create multiple flows of income through investments (real estate, multi-level marketing are two examples).
- Use debt to make more money, not to buy “comfort.” The wealthy aren’t using credit cards for movie tickets.
- Make wealth a priority.
2008 seems like a long time ago but those wounds are fresh and a crash like that will happen again. This is why you can’t get angry at “the economy.” Instead focus on “your economy” and build something that will care for you and your family for many years to come.
Be great, nothing else pays.
