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Why the Rich are Getting Richer- and You Can Too!



Why are the rich getting richer?  It’s a question a lot of people are asking these days.  We hear on a daily basis how the middle class is shrinking, the poor are getting poorer, and the number of new millionaires is growing every year.  The extreme upper class (the so-called “mega-rich”) is increasing every year as well.

So why is this happening?

There are plenty of reasons. Some say it's about greed, the government, privilege, or any number of other things beyond any one person's control. However, one of the biggest reasons is that the world has become a world of people in perpetual consumer debt.

You Won't Get Rich With Consumer Debt


You might ask, “Don’t we need debt just to live a normal life these days?”

Well, the answer is “yes” and “no”.  Do you need consumer debt just to get by? No, you don't.

Do you live a normal life if you’re in debt?  Unfortunately, yes.

For about the last 40-50 years, credit card companies, banks, and other lenders have been chipping away at the basic values of saving and living on less than you make that were once common.  They encouraged us through their marketing to use borrowed money to increase our lifestyle using easy monthly payments.

The only problem with that is that when you use consumer debt, you lose financially.

You end up paying more for the things that you buy on credit than if you had just paid cash.  Sometimes it ends up being 20% more.  Sometimes you end up paying more than double.

Where does all that money go?  It goes to the credit card company, the bank, the car dealer, and the department store.  It goes to people who understand money and know-how to get it from those that don’t.

Money goes to the people that have a plan.

Why the Poor (and Middle Class) are Getting Poorer


One of the biggest reasons (but not the only one) so many people are hurting while the rich are getting richer, is that the average families live on more than they make.

They purchase groceries, restaurant food, new cars, and most everything else with credit cards and monthly payments. It costs thousands of extra dollars a year to finance, but most people look at it as being normal.

Consumer debt creates a false sense of prosperity that actually results in the opposite, which is bondage and slavery.

If most people would sit down and run the numbers, they'd be shocked at how much debt is costing them every year!

Why is Consumer Debt Such a Problem?


Consumer debt has become a way of life for several reasons:

  • People like to keep up with the Joneses- it's human nature to want to have what others have.
  • Credit is marketed heavily, to the point that people think it's abnormal not to use it.
  • Most people are just not educated about money.
  • Most don't have a plan for their money.
  • People are less patient- they want things now instead of having to save up for them.

Consumer debt is a path of least resistance. It lets you have what you want right now, for easy monthly payments, with little money out of pocket.

But the end result is that the people who can least afford it end up paying extra for everything! It's a never-ending cycle that keeps you in bondage as long as you decide to keep using it. It's all about personal responsibility.

The Rich Understand Money


That brings me to share with you one of the most basic principles of money that many people never really think about or act upon.  That principle, simply put, is this:  Money will always flow to those who understand how it works, and away from those that don’t.

It doesn't take any special talent to understand money, just a willingness to constantly keep learning and applying what you learn.

A Few Simple Rules for Getting Richer


The 1% don't think or act like the rest of us, and this is why they are the 1%. So when it comes to building wealth, the first thing you should understand is that you have to learn to think and act differently when it comes to money.  Below you'll find a few simple rules to help you get there.

Always Spend Less Than You Make


This should be common sense. Unfortunately, most people spend more than they make. When you live with consumer debt and no real plan for your money, you'll never get ahead.

Always Have a Plan for Your Money


Believe it or not, research shows that the rich people who stay rich live on a budget. They know that when they have a proper plan for how they spend money, they will never spend more than they make. I always recommend using a monthly zero-based budget that never allows you to spend more than you make.

Make Saving a Priority


Most people, if they save at all, save money that's leftover after paying the bills. That's a sure sign that you have no plan. Those who become rich make savings their top priority before paying the bills. I always teach that you should pay yourself first (or second if you're a tither).

Invest Your Money


Your money doesn't grow if you don't invest it. If you don't have an IRA, Roth IRA, or haven't opted in to your company's 401k, what are you waiting for?

Believe it or not, the research shows that the average millionaire got there by investing in the stock market through the traditional retirement plans listed above.

They Never Compromise Good Financial Habits


Those who become wealthy don't compromise. They practice personal responsibility, build good financial habits, and practice them for a lifetime. You hear all kinds of stories about people who get rich quickly, but you don't hear about the ones that build it one paycheck at a time over many years. This is how most people build wealth.

Those get rich quick people, they don't stay rich for long because they didn't build the right habits.

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