What is the definition of being rich? In my earlier post titled ‘who is the richest in the world?’ I have explored very emotionally on the definition of being wealthy in monetary terms. But if we focus on others’ economic well being, we often fail to focus on our financial standing. What is our financial status at this point in time? Have you ever asked yourself this critical question? There can be only two reasons for not asking such a question.
Extreme contentment not only makes your mind sit in the comfort zone but it is the stumbling block to any success. The second factor can be the fear of reaching a plan or goal. There is nothing wrong to count your blessings but at the same time you need to check whether it is the ‘devil in disguise’.
If you had planned to reach you goal, you have face it fearlessly. If you can gauge your contention and be bold enough to take the necessary steps as planned, success will knock your several doors.
If your son ask you this question – “Dad are you rich?”- What can be your answer to him? Before you answer or ponder you need to know something about income and liability.
Extreme contentment not only makes your mind sit in the comfort zone but it is the stumbling block to any success. The second factor can be the fear of reaching a plan or goal. There is nothing wrong to count your blessings but at the same time you need to check whether it is the ‘devil in disguise’.
If you had planned to reach you goal, you have face it fearlessly. If you can gauge your contention and be bold enough to take the necessary steps as planned, success will knock your several doors.
If your son ask you this question – “Dad are you rich?”- What can be your answer to him? Before you answer or ponder you need to know something about income and liability.
Income
If you have large amount of cash – you are definitely rich. Dad “A” earning a monthly income of $25,000 for his family of five (including him) is definitely richer than Dad “B” who earns only $2,500 per month other things remaining the same.
But then money is not earned for the sake of earning. It has to be spent on food, clothing, shelter, health and personal care. If Dad “A” spent ninety percentage of his income then he is actually poorer than Dad “B”. This is common sense.
In other words your earnings do not make you a rich or poor dad. But your expenditure does. If you can control your expenses, you come out rich.
Asset
In Singapore, you can become rich if you can go into oil or property business. A house is an asset. If a property brings income then it is an asset. If cash is used to pay for debt servicing I think it is wise to sell off the property. If you are holding onto the property hoping it will fetch a good price in the future then the property is an investment.
If you want to invest in gold or stocks be prepared to take risk as the market can be volatile.
Dad Are You Rich?
The answer is very simple. If the monthly cash inflow exceeds the expenditure, he is a rich dad. Expenditure can be divided further into essentials and non-essentials. Essentials are food, clothing and shelter and a little entertainment. Examples of non-essentials are as follows:
getting a hand phone for your son
buying gold or diamond for your wife
purchasing an inexpensive gift for a rich boss
chatting with cyber friends unnecessarily(wasting electricity)
paying the outstanding property loan by cash
eating out
watching television
taking frequent baths
making friends by entertainment
using of credit card when you can pay by cash – interest payment
driving a car in Singapore
The urge of getting everything we wanted is the root of all causes of financial troubles. Living within your means will actually place you in placid mind. A peaceful mind is needed for enriching your lives.
The definition of being rich is how well you apportion your income into expenditure and savings or investment. In expenses exceeds income then you are poor!
[poor dad]
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