Why Wealth is Only Half the Story
Why Wealth is Only Half the Story
By Max From The Money Mix
When financial freedom is mentioned, what comes into your mind?
You probably think of having plenty of material wealth and possessions, perhaps.
Well, that’s just not the whole story. I will let in on a secret that most people miss. Financial freedom is not just about attaining plenty of monetary possessions, it’s more than that.
Financial Freedom Secret
A majority of people make the mistake of tagging their value of financial freedom on some imaginary figure or a specific amount of money. They envision that, once they hit that target amount, then they will have attained financial freedom and will no longer have to work again.
Well, think about the likes of Bill Gates, Warren Buffet and other fellows who are wealthiest in the world. The money they have can sustain them for their entire life. But, they still work, however, their motivation is now different.
What drives and motivates them to do the things they do is something totally different from just the need for money. They still work to probably make the world a better place, to get recognition, to build a legacy among other forms of motivation. There are numerous quotes about financial freedom. Warren Buffet once said, “Someone is sitting in the shade today because someone planted a tree a long time ago”.
Investing for a long-term impact should be the driving force.
So, why is wealth only half the story? Let’s look at some basics of wealth.
The Basics of Wealth
Wealth and possessions are just one among many other means to financial freedom. Economically, wealth represents a person’s net worth and financial position. It is obtained using a personal financial ratio where the total liabilities are deducted from the total assets. Wealth is categorized into three categories which include personal property, monetary savings and capital wealth.
Personal property includes tangible items such as the automobiles, houses, the monetary savings include an accumulated past income and capital wealth includes the value of the income-producing assets.
Wealth can provide some form of safety net or protection against the unforeseen decline in the individuals’ living standards in the event that they lose their job or has another form of financial emergency.
Wealth is a compilation of things that are limited in supply, are transferable and can be useful to meet certain human needs. Therefore, scarcity forms a key factor in wealth. Wealth is considered an accumulation of something that is scarce and a resource with net asset value.
When you have the abundance of these resources, you will not have to worry about the money you need to meet your physical needs. However, it is still possible to feel inadequate once you obtain the amount of money you’ve always figured. Wealth can help you meet various physical needs such as shelter, clothing, food, but does it really help meet all human needs?
Let’s see how you can achieve financial freedom in relation to diverse human needs:
Human Needs and Achieving Freedom
To continue reading, please go to the original article here: