#1 Difference Between The RICH And The POOR 💸 #Best Education Page #Online Earning

- So in this video today,

we're gonna be talking about what separates the rich people

from the poor people out there. Now, I know this can be

an incredibly touchy subject out there

so I'm certainly not trying to o
ffend anybody

but what I'm trying to show you guys today

is that there is a winning formula when it comes to money

and there is a losing formula when it comes to money.

And unfortunately, most people out there

are following the losing formula to this game of life

or this game of money.

Now, some people are fortunate enough

to stumble upon this idea,

whether it's from their family members

or whether it's from a book or some kind of mentor,

and what you'll find is that a lot of rich people

are passing this secret along

to different generations in different ways.

There are different ways that you may come across this,

whether it's from a book or whatever it may be,

but not everyone is exposed to this very important lesson

and so that's what I'm hoping to do

is show you guys this lesson and let you understand

why it is that the rich are getting richer

and the poor are staying poor.

Now, I know a lot of people that are watching this

have already learned this lesson

and I'm just glad that you already know it.

But what I will ask you is if you know somebody

who doesn't know this lesson,

just share this video with them

that in a way they can learn this and understand

why it is that some people end up rich

and some people end up staying poor for their entire lives.

But at the end of the day,

we all have the same 24 hours a day

and seven days per week.

So why is it that some people end up being millionaires

or billionaires or soon we're gonna have trillionaires,

meanwhile, some people never have two pennies

to rub together for their entire lives.

We all have the same time in each day

and the same opportunity to spend that time

but some people end up filthy rich

and some people never end up having any money.

Why is that the case?

The reason being is the fact that the game of life

is not necessarily a fair game.

And I learned this in two different ways:

Number one, I could remember when my dad sat down with me

and told me that when he was younger, he always imagined

there being a system of checks and balances

where everybody got their fair share in life.

And he said when he got older,

he learned that there is no such system.

Those who go out and get it are the ones

who end up with the money.

Those who just wait around for it,

well, there's no system that's gonna make sure

you're getting the money that you want.

When I heard that lesson from him,

what I realized is that you don't get ahead in life

by playing by the rules.

So if you're following the rules

that somebody else has laid out for you

particularly in school or from somebody else

who has not achieved the level of wealth you're looking for,

you're playing by a bad set of rules.

And the second place I learned this

is from Rich Dad Poor Dad, Robert Kiyosaki.

This is not anything that I have made up myself.

Recently, I saw Financial Education

did a video talking about this

and I wanted to do my take on it.

So this is by no means my own secret

or even a secret in general.

It is just a very important financial lesson

that so few actually understand.

So at the end of the day,

you can either complain about your financial circumstances

and continue to follow this losing formula over here

or you can just accept the fact

that it's not necessarily a fair game.

There's no system of checks and balances,

and play the game to win.

And I certainly hope you end up over on this side

playing this game to win.

But let's go ahead and start it off

by talking about the poor side of this equation

and what formula they are following.

The most common one that I'm seeing these days,

especially among young people is I is equal to your E.

Your income is equal to your expenses.

So for every $1 you earn, you're spending $1

and this is what you call paycheck to paycheck.

I'm sure you've heard of this before.

This is where I believe the majority of Americans

are right now is living paycheck to paycheck.

Every dollar that goes in goes out

and they're not saving any money for retirement

or expenses or vacation or anything like that.

They're just taking it day by day,

and this is not the worst place to be

but it's certainly not the best place either.

Below that is one that's even worse than that

and unfortunately, a lot of people are here as well,

that is when your income is less than your expenses

and you're actually going into debt.

A lot of people are in debt

or going into debt every single day,

and this might be where your income is a dollar

but your expenses are a $1.10.

So for every $1 you earn,

you're going another 10 cents in debt

because you are spending more than you are earning.

And these first two categories are where most people are.

Now, this bottom one is where some of the middle class are.

These would be probably the lower class,

this right here is where the middle class usually is.

This is when your income is greater than your expenses

but you're taking that surplus

and you're buying L, you're buying liabilities.

One of my favorite ways to look at this

is anything with an engine is typically a liability,

whether it's a motorcycle, a boat, a car,

and this is where the middle class go wrong.

The lower class, these people don't even have

any discretionary spending income.

Some of them don't even have enough money

to keep themselves out of debt.

But the middle class are typically

taking that extra surplus income

and dumping it into liabilities,

things that are going to depreciate in value over time.

You're gonna buy that motorcycle for $10,000

and you're gonna pay for insurance and pay for gas,

and then five years later, you're gonna sell it for $4,000.

That is not ever going to appreciate in value,

and this is exactly what the middle class

does with their surplus income,

and it puts them at the exact same level

as the people following the above two equations.

And what the rich people are doing is very, very simple.

What they are doing is they're making sure their income

is greater than their expenses

which is the same thing that the middle class is doing

but they're taking that money

and they're purchasing assets instead of liabilities.

Now, what are assets?

This could be something like the stock market,

this could be real estate,

this could be rare coins, this could be gold coins,

it doesn't matter what it is,

assets are simply things that tend

to appreciate in value over time.

Now, where is most of the wealth generated?

A lot of people are making money in real estate

and the stock market.

Yes, there are cryptocurrencies,

other assets that are newer,

but the two things that have been

making people rich the longest

are the stock market and real estate.

And I know a lot of people say the fastest way

to wealth is real estate

and I would certainly agree with that.

The stock market is more of a passive approach

to generating wealth,

but either one can get you to the same place

as long as you follow this formula.

You take your income, you make sure that your expenses

are lower than your income.

So maybe for every dollar you earn,

you have 80 cents worth of expenses

and then you take that 20 cents

and you put it towards the assets.

But what you're doing that's going to actually magnify

this process is taking your return on your investment,

your returns generated from your real estate

or your investments,

and reinvesting that back into the purchase of more assets.

That is what the rich call letting money work for you.

This is something that has been taught many times over,

earning more money from the money that you already have.

That is the simplest explanation

why the rich are getting richer

and the poor are staying poor,

it is these formulas right here.

If you think about it this way,

let's say this person here has a dollar of earnings

and they have 80 cents of expenses,

meaning every dollar they earn,

20 cents goes towards the purchase of assets,

and then let's say they have a dollar here of income

and then 10 cents of return on investment.

So then $1.10,

they still have that same 80 cents of expenses,

now 30 cents are going towards the purchase of assets

and then it will be 40, and 50, and 60.

As they're making more money,

they're investing more money,

as they're investing more money,

they're earning more of a return from their investment

and that return from their investment

is allowing them to purchase more assets

that are going to generate them more wealth.

And that right there is why people are getting rich.

They are following the winning formula

and they're playing the game

by the best set of rules possible.

Now, I'm not saying that these rich people over here

are never, ever going to spend any money

because you might be asking yourself

why do you see rich people

driving Lamborghinis or in yachts,

and it's because eventually,

they get to a point where this number right here,

their ROI, their return on their investment

can pay for their liabilities

like the things with the motors and the boats

and the fancy cars.

They're never taking their income, their active income,

and using that to purchase liabilities.

Their active incomes goes towards purchasing assets

and eventually, those assets pay

for whatever fun things that they want down the road.

So this right here is the winning formula to follow

when it comes to making money,

and these two right here are the losing formulas

that so many people are following unfortunately.

So to put it simply, you can spend very little early on

in order to be able to spend a lot of money later on

when you are basically living off

of the returns from your investments

or you can follow what the middle class do

and any money they're earning

goes towards purchasing liabilities.

That's what keeps people on the rat race.

That's what keeps people in that hamster wheel

is the fact that they are never getting ahead

'cause everything they're buying depreciates in value

and is heading to zero.

But anyways, guys, just gonna wrap up this video.

I hope you enjoyed it.

Let me know where you guys learned this lesson.

Was it from a book, from your parents,

wherever you learned it, I'm very curious.

If it's your first time learning this lesson today,

comment down below. I would love to hear that as well.

But thank you guys so much for watching.

Don't forget to share this with a friend

if you know somebody who needs to hear this lesson.

If not, I will see you guys in the next video.

#Best Education Page #Online Earning

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