Native home with Yapese money stones indicating great wealth. Stones were mined on Palau and carried by outrigger canoe 300 miles. Money stones are quarried from stalactites in limestone caves (Photo credit: Wikipedia)
The definition of wealth is the number of days you can survive without physically working (or anyone else in your household physically working) and still maintain your standard of living.
For example, if your monthly expenses are $5,000 a month and you have $20,000 in savings, your wealth is approximately four month or 120 days. Wealth is measured in time, not dollars.
Ultimately, it’s not how much money you make that matters, but how much money you keep, and how long that money works for you. Every day I meet many people who make a lot of money, but all of their money goes out the expense columns.
Every time they make a little more money, they go shopping. They often buy a bigger house or a new car which result in long-term debt and more hard work. Nothing is left to go into the asset column.
Many people, rich and poor, operate constantly at the financial red line of their personal finances.
The trouble with operating your car’s engine at red line is that the life expectancy of the engine is shortened. The same is true with operating your finances at the red line.
Robert T. Kiyosaki