Rich man, Poor man

Here’s the scenario:

There are two guys, we’ll call them Butch and Rich. Two of these guys are filing their income taxes in my friend’s office.

Butch is about 60 years old, retired, dressed conservatively, gets out of his 1984 Mercedes convertible drinking his coffee in a styrofoam cup.

Rich is probably about 50, driving his new convertible BMV, wearing a Tommy Bahama silk shirt with his gold watch and gold chain, holding his coffee in a Starbuck’s cup.

My friend knows all too well to judge a person by what he drives or what he wears. The financial statements tell all that happens behind the scenes.

It turns out Butch invested well and lived within his means all throughout his life. He has retired two different times, one from the military and one from the government. He draws two incomes even now. He has a million dollar home, rents out 2 homes, has an investment property that people want to buy. He also has mutual funds, stocks, life insurance, and money in the bank. His wife also has a retirement, she retired early at 55 years old. She was *just* a production worker and received an early severance package.

And our friend “Rich”, he wasn’t rich (with money in the bank) at all. Yes, he made a lot of money, 6 digit figures. He holds a top position in a leading business firm. He didn’t make good choices with the money he earned. He did not invest his money, he did not save his money, he did own a home but it was upside down. He borrowed against his home loan and now, he’s stuck in his home and mortgage. He owns all kinds of toys: a boat, his new BMW, ATVs, and I’m sure a closet full of nice clothes and shoes. If he doesn’t turn his finances around, how will his life be in 10 years? Will he be where Butch is now; retired, secure, healthy and financially free?

I don’t care how much money you earn. I don’t care what brand you’re wearing. I don’t care what kind of car you’re driving. I don’t care if you can afford Starbuck’s coffee or not.

I do care about what you’re doing with your money. Are you wise with your money? Are you letting your money work for you and not working for the money to pay debt?

Looking rich vs. Being rich.

Which one are you today? Where do you want to be in your future? Do you need to re-align your priorities?

It’s not too late.

What do you do first? Try eliminating those unnecessary monthly expenses. Get rid of the boat, downsize to a more practical car, get rid of the clutter, or take the first simple step, don’t buy anymore things on credit.