What’s the definition of being wealthy? Is it being a millionaire? Living in a big house? Being debt free? Earning a large salary? Having a large pension pot or a significant investment portfolio?
All of these are helpful indicators, but I personally think they only show a small part of the picture and, as a result, miss the point. It needs to go deeper…
Having a good income or a large asset base is only half the story. True wealth is about being able to do what you want, when you want. In short, it’s about freedom.
So, under this definition, what does being wealthy mean?
When you’re working; it means being able to live the life you want within your means, no matter how much you earn. It means that whilst doing this, you are able to provide for your future and protect yourself and your family against any speed bumps in the road.
When you’re retired (or retiring); it means having enough income and assets (to generate an income from) that you can live a life of meaning and purpose to you without fear of running out of money.
This means that someone with a modest income can be ‘wealthier’ than a high earner, if their lifestyle expenses are within their means. After all, if someone has £1 million but needs £2 million for their goals, they do not have financial freedom.
We need to change the perception of wealth. Real wealth isn’t about money at all. It’s about establishing what you want to do with your life and amassing enough money to fund that life. Under this definition, a ‘wealthy’ person is someone who has enough financial resources to live a truly free life of their choosing.
What’s the message? Focus on measuring what matters. Do you have enough money to do what you want to do, when you want to do it? This is at the core of what we do. So if you know anyone who needs help with this, please feel free to introduce them for a informal chat over a coffee.
Lastly, I hope you’re all enjoying the British Summer and managing to keep cool and hydrated.