Rich vs. Wealthy: What’s the Difference?

Hi Money Masters!

I sure do hope you are seeing a lot of green lately! I’m not just talking about St. Patrick’s Day coming up. I’m talking about…MONEY! That is to say, I hope you are all doing your best to stay focused on your financial goals and that you are continuing to work towards increasing your net worth. With St. Patrick’s Day comes a lot of discussion and visuals related to pots of gold and riches. I think it’s safe to say that I’m not the only person who wishes a leprechaun would leave a pot of gold lying around the house! So, in the spirit of the holiday, let’s take a look at the difference between rich and wealthy.

What do you think of when you hear these two words? Some might think they have pretty much the same meaning. According to merriam-webster.com, the definitions are very similar:

“rich”:  having abundant possessions and especially material wealth

“wealth”: abundance of valuable material possessions or resources

However, in the world of finance, there can be a difference in the terms. Being “rich” simply means having lots of money. One can have a high salary, expensive cars and big houses but the price of living that lifestyle does not always allow for being able to build real wealth. A rich person could still be living paycheck to paycheck. The definition for “rich” above specifies an abundance of “material” possessions.

Taking a closer look at the definition for “wealth”, we find that it mentions, not just material things, but “valuable resources”. Those resources are intended to work in a way that will provide financial freedom, which is the biggest difference when comparing rich vs. wealth.

Imagine not having to work or working less and knowing that all your bills can be paid without worry. Imagine building wealth for future generations! That is FINANCIAL FREEDOM.

To build wealth, here are a few starting points…

#1. Start saving as EARLY as you can.

#2. Find sources of passive income.

#3. Work more: the term “side-hustle” is very trendy right now.

#4. Get educated on investing.

The terms rich and wealthy still can mean different things to different people, but one thing is true: You don’t need to try and catch a leprechaun to get your pot o’ gold!

Blessings, and the luck of the Irish 😉 to you all,

-Helen