Wealth Creation Blog

The typical debt cycle of the working family goes something like this:  

* Graduate school/university/college

* Get a good job

* Start going after the ‘things’ you want in life

* Use credit to get ‘things’ (to appear & feel wealthy)

* Become debt-heavy, cash poor

* Work week to week to meet the bills

 The typical debt cycle of the wealthy goes more like this: 

* Graduate school/university/college

* Get a good job

* Start building a base of savings

* Start buying assets/investing (things that make money)

* Keep job to fund more asset procurement

* Create income stream from assets

* Buy ‘things’ with cash money or asset-backed credit

* Gradually replace job income with asset income

* Retire early

The key difference between these two is the focus

 Early on, the working class (those who do not break out and create wealth; even the wealthy can start off in the working class) focuses on attaining the ‘things’ in life that they feel will make them feel wealthy and/or appear wealthy. The wealthy place the focus on building cash stores and investing—putting that money to work in the form of asset procurement; they worry not about ‘looking’ wealthy because they know that surely will come in due time. 

The good news is that it is never too late for the working set to break out of this cycle.  If left unchanged, the cycle will simply repeat itself into and beyond the retirement years.  The working man or woman will be lucky to retire at all, and many will become dependent on family or government; a few will have accumulated adequate retirement funding. Any time is a good time to break this cycle.  It does not matter one wit what your current financial situation is.  You can be buried in debt without an extra cent and you can make changes today that start you on the road to wealth creation.  It’s time to put yourself and your loved ones first and break the debt cycle with wealth creation.

Sean Rasmussen
Wealth Creation Blog
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