Before a business owner begins to grow any type of wealth, and, actually, before he or she even starts the process, exactly what wealth is must first be established. Many people continue to labor under the misconception that wealth is simply having tons of money stashed away in the bank, but this myth ignores some of real wealth’s most important aspects.
Wealth is personal. No two individuals share the same financial situation, making comparing financial statuses with the neighbors next door more than just useless, it can be harmful.
Wealth is freedom. Most people who live paycheck-to-paycheck simply want enough money to pay for groceries, keep the lights on and to maintain an engaging social life. Sure, this might be nice, but with wealth comes the freedom to choose between grocery shopping and eating dinner out without having to worry about the price or cost of either.
After an entrepreneur understands what it is he or she wants the freedom to be able to do, he or she needs to understand two last things about wealth.
Wealth is not saving every penny. While a savings account with money set aside for emergencies is almost always a smart idea, it might not always be the best idea for every entrepreneur. Banks have notoriously low interest rates on savings accounts, so money not in use is typically better off being invested at higher rates.
Wealth is not from one source. Wealthy individuals did not make it by cashing in a paycheck every two weeks. While a steady paycheck is important, other lines of income must be utilized in order to reach true wealth. Investments and even secondary businesses are often the way to go for extra sources of income.
Wealth is not the unattainable goal that so many people seem to believe, and this is most likely because the true meaning of wealth is often misunderstood. Understanding what wealth entails is the first step to enacting a successful business plan that will lead to real, true wealth.