Rich person work harder to get unemployable
while poor and middle class person work harder to get employable.
That is the reality of world.
For those who rich,
The most important thing is cash flow, second is leverage.
cash flow and leverage makes someone rich.
Cash flow is the money you get each month,
you could get it through your income either earned income or passive income.
but usually, rich people get rich because their passive income/portfolio income is higher
than their earned income. That's why they dont have to work anymore.
Second most important things is Leverage.
we use leverage to makes us rich.
Leverage available nowadays are computer, telephone, newspaper,
internet, bank loan and many more.
Debt is always the best leverage to make someone rich,
of course , it has to be a good debt.
There are two kinds of debt in the world:
Good debt and Bad debt.
Good debt helps us buy Asset,
which is something generate cash flow or income.
while bad debt bought us liability that will only take money away from us.
Why middle class people are still middle class?
Why poor people are still in poverty?
Because their bad debt over the good debt,
because their earned income is higher than their Passive /portfolio income.
There are 3 types of income in this world. :
- Earned income
-Usually with constant paycheck
-Usually earn with labour and hard work.
-Apply to all the employees included those in professional .
- portfolio income
-Usually from intellectual assets.
- passive income
-Usually from owning a business that's run by a CEO.
-Investment.
-Stock, bonds, mutual funds.