Paying yourself first

I read somewhere the true wealthy concentrate on increasing their assets not income. But I suppose again it is up to us to decide what we want in life?
Yeah, but to get the assets, you first gotta get the income.
That is, if you're starting from nothing and didn't inherit your bankroll.
 
Yeah, but to get the assets, you first gotta get the income.
Quantify 'get the income'? how much income is that?

I know of people well into 6 figure incomes who have less net asset bases than others on the average wage & below.

That in itself suggests it's not income level, rather what one does with the income one has to work with.
 
I read somewhere the true wealthy concentrate on increasing their assets not income.
The true wealthy build capital for income, whilst others cover their holding costs for them along the way..

The poor/middle class simply keep selling their time for income.
 
Quantify 'get the income'? how much income is that?

I know of people well into 6 figure incomes who have less net asset bases than others on the average wage & below.

That in itself suggests it's not income level, rather what one does with the income one has to work with.
That's a bit like saying a champion F1 driver driving a Hyundai Excel would beat a soccer mum driving an F1 car around a lap of Monte Carlo.

Boot out the soccer mum and put in a weekend club driver and he'll blow the Champion driver away.

It's a combination of the operator and the vehicle which counts, but the vehicle makes a huge difference in speeding up process.
 
I read somewhere the true wealthy concentrate on increasing their assets not income. But I suppose again it is up to us to decide what we want in life?
An asset is no good without an income, or unless you are using the asset to hopefully increase in value so you can later access it's equity to buy another asset/s that has/have an income/s.

I think most folks want more money, more freedom from having to work, and a better lifestyle in their life.

Otherwise; almost every single doodad we buy, every cool house/apartment etc, every Lotto competition, etc - would cease to exist...we'd all be living in bark huts in the bush.
 
What Im saying is, for that F1 driver to have become the race champ he is today, he had to want to learn how to drive one many years before.

That's a bit like saying a champion F1 driver driving a Hyundai Excel would beat a soccer mum driving an F1 car around a lap of Monte Carlo.

Boot out the soccer mum and put in a weekend club driver and he'll blow the Champion driver away.

It's a combination of the operator and the vehicle which counts, but the vehicle makes a huge difference in speeding up process.
 
What Im saying is, for that F1 driver to have become the race champ he is today, he had to want to learn how to drive one many years before.
True.
There's so many ways to look at this.

You can have an active young guy who's super talented beyond his years on how to make money, 400k/annum in fact, but can't seem to keep a hold of it and pretty much spends the lot on lifestyle.

On the other hand, you could have say a high school teacher who's been in the industry for 20 years and built up a mil in net worth by conservatively investing in property in the past 10 years.

Who do you think has more potential financially in this situation if they make some simple changes in mindset, which is the key factor here. If you can't make the change nothing else matters.
 
An asset is no good without an income, or unless you are using the asset to hopefully increase in value so you can later access it's equity to buy another asset/s that has/have an income/s.

I think most folks want more money, more freedom from having to work, and a better lifestyle in their life.

Otherwise; almost every single doodad we buy, every cool house/apartment etc, every Lotto competition, etc - would cease to exist...we'd all be living in bark huts in the bush.
Ok I apologise for being so general, I meant assets, obviously that generate income so you can spend on what you want!
 
The value of the asset would grow as income grows.
If you invest it right? As pointed out when income stops how do you acquire assets? If assets grow generating income then you have income for life.
I think what I meant is like an analogy to an apple tree. You can plant an apple tree and then reap the apples as they grow, or you can just keep buying apples...
I think most assume income means wealth, well unless it is passive income generated from assets so that you can stop working, so not job derived income then yes.
As pointed out by others there are lots of people on high incomes yet they are asset poor, would you classify them as wealthy then?
I supposes most people can be classified as Income poor/asset poor, Income rich/asset poor, Income poor/asset rich, or Income rich/asset rich. I know which quadrant I am in or which one I would like to be in.
I suppose most would like to be in the last quadrant, right?:)
 
share holder

When you can walk away from the business and it carries on a profitable venture without you.
Isn't the ultimate extension of this that you become the primary shareholder (and does that mean you are now just an investor)? You can't just delegate responsibility without handing over proportionate control.

Grant.
- newbie
 
If you invest it right? As pointed out when income stops how do you acquire assets? If assets grow generating income then you have income for life.
I think what I meant is like an analogy to an apple tree. You can plant an apple tree and then reap the apples as they grow, or you can just keep buying apples...
I think most assume income means wealth, well unless it is passive income generated from assets so that you can stop working, so not job derived income then yes.
As pointed out by others there are lots of people on high incomes yet they are asset poor, would you classify them as wealthy then?
I supposes most people can be classified as Income poor/asset poor, Income rich/asset poor, Income poor/asset rich, or Income rich/asset rich. I know which quadrant I am in or which one I would like to be in.
I suppose most would like to be in the last quadrant, right?:)
Couldn't give a rats about the assets as a measure of wealth.

Only insofar as they are a means to the end - heaps more income.

I'd be happy to be earning a $1m per year and no assets (as long as the income was secured for life - this is where the assets becomes important, because a $1m PAYE job can end at any time.)
 
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Couldn't give a rats about the assets as a measure of wealth.

Only insofar as they are a means to the end - heaps more income.

I'd be happy to be earning a $1m per year and no assets (as long as the income was secured for life - this is where the assets becomes important, because a $1m PAYE job can end at any time.)
That's just it, an earned income is not secured for life, is it? What if you had a car accident, what if you were fired unable to generate earned income? What if you became terminally ill so income is not secured for life, but passive income can be generated for life.
Obviously my analogy or comparison was to acquiring golden goose that then lays golden eggs OR planting a seed to grow an apple tree then picking apples of that tree.
I assumed most understand assets which produce passive income... Obviously what is a golden goose to me if it doesn't lay a golden egg?
Didn't Mr. Buffett say, "Someone is sitting in the shade today because someone planted a tree a long time ago."?:)
 
That's a bit like saying a champion F1 driver driving a Hyundai Excel would beat a soccer mum driving an F1 car around a lap of Monte Carlo.

Boot out the soccer mum and put in a weekend club driver and he'll blow the Champion driver away.
Given how technically complex F1 cars are these days, I think the F1 driver would win whether it's in an Excel or on foot.
 
True.
There's so many ways to look at this.

You can have an active young guy who's super talented beyond his years on how to make money, 400k/annum in fact, but can't seem to keep a hold of it and pretty much spends the lot on lifestyle.

On the other hand, you could have say a high school teacher who's been in the industry for 20 years and built up a mil in net worth by conservatively investing in property in the past 10 years.

Who do you think has more potential financially in this situation if they make some simple changes in mindset, which is the key factor here. If you can't make the change nothing else matters.
Nice analogy.

Like any investments the more income/earning capacity you have the more potential you have. The person with the greater earning capacity also has the ability to do better via compounding interest and can afford to invest in the 'blue chip' suburbs, whilst the lower income earner can't afford to throw too much money into high capital growth/low yielding suburbs without seriously affecting their servicability.

My plan is to spend my 20s investing in myself as much as possible, whilst also saving as much as as possible. Hopefully the investment pays off by leading to a greater income into my 30s and beyond and use the increased earning potential to incease my leverage and build a nice portfolio. Atm I'm in my early-mid 20s and stuck on a 48k income, which limits me to purchasing in high yield/low capital growth metro suburbs, which are typically outer surburban.
 
Can you increase your income?

2 jobs? 3 jobs? and reduce spending if possible. Is all that possible? All depends how badly you want it. I don't see why you need to wait till 30 to start mate. Your only stuck on 48k a year if you think so.

:)

Leo
 
Can you increase your income?

2 jobs? 3 jobs? and reduce spending if possible. Is all that possible? All depends how badly you want it. I don't see why you need to wait till 30 to start mate. Your only stuck on 48k a year if you think so.

:)

Leo
I'm going back to uni and getting another degree in an unrelated industry. I plan to keep working full time whilst studying as well. I'm 24 now hopefully I can finish it within a few years. Upon graduating if all goes to plan I'd be on around 60k and hopefully within 5 years I could be up to six figures once I've gained more experience and responsibility.

Plus another part of my post that I forgot was about property development. I've never seriously looked into it just because of my circumstances it's more a dream than anything atm. However, in the future I would love to have enough income to be able to get serious about it one day on a large scale e.g apartments instead of residential subdivides.

The good thing is I'm already on the property ladder albeit just 1 property atm:)
 
I'm going back to uni and getting another degree in an unrelated industry. I plan to keep working full time whilst studying as well. I'm 24 now hopefully I can finish it within a few years. Upon graduating if all goes to plan I'd be on around 60k and hopefully within 5 years I could be up to six figures once I've gained more experience and responsibility.

Plus another part of my post that I forgot was about property development. I've never seriously looked into it just because of my circumstances it's more a dream than anything atm. However, in the future I would love to have enough income to be able to get serious about it one day on a large scale e.g apartments instead of residential subdivides.

The good thing is I'm already on the property ladder albeit just 1 property atm:)

Hey 2fast4u,

I think having dreams are very important so good on you. Just curious any reason why you want to get anotehr degree in an unrelated field?

Cheers

Leo
 
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