Imagine two people.
One earns $200,000 a year.
The other earns $70,000.
Who do you think is wealthier?
Most people would probably choose the person making $200,000.
But what if I told you that person spends nearly everything they earn?
The luxury car. The expensive house. The vacations. The lifestyle that requires them to keep making $200,000 just to maintain it.
Meanwhile, the person earning $70,000 lives comfortably within their means, invests consistently, and gradually builds assets.
Ten years later, who do you think might be in a better financial position?
Here’s the lesson.
Income is what you earn.
Wealth is what you build and keep.
And looking wealthy is not the same as BEING wealthy.
Now, don’t misunderstand me.
I’m absolutely an advocate for increasing your income!
There’s nothing wrong with wanting a beautiful home, nice things, or a comfortable lifestyle.
I want those things, too!
But I also want the freedom to enjoy them without being financially dependent on my next paycheck.
When your income increases, you have a choice.
You can increase your lifestyle to match it, or you can use some of that additional money to acquire assets that may grow in value or generate income.
Ideally, you find a balance that lets you enjoy your life today while building financial security for tomorrow.
Because the goal isn’t to spend your entire life making money just to keep up with the life you’ve created.
And I’ll share something personal.
There was a time when I had the opportunity to buy a Lamborghini, but I chose to put that money toward another rental property instead.
Not because I don’t want a Lamborghini. Trust me, I do!
But I figured I could buy the car later. The opportunity to acquire another income-producing asset was more valuable to me at that moment.
I wasn’t giving up the lifestyle I wanted. I was choosing how I wanted to pay for it.
That’s the mindset I want to encourage.
Enjoy your money. Celebrate your accomplishments. Buy yourself nice things!
Just remember to build something for your future self along the way.
Because making more money is wonderful.
Learning what to do with it is where wealth building begins.
Be honest. When your income increases, is your first instinct to upgrade your lifestyle, save, or invest?