Perpetual Wealth is a goal that many people aspire to. The common image in people's mind is being at a tropical destination, enjoying the weather and living life on their terms while not worrying about money. However, there are some who feel that this is just not realistic and is merely a myth.
So what exactly is perpetual wealth? In simple terms, Perpetual wealth is when you're able to generate income from assets and investments without having to work for it.
Perpetual Wealth Is Difficult To Achieve But It Is Not A Myth
You may wonder how it is possible to achieve a perpetual wealth, or if it is even worth the effort. However, perpetual wealth is not just a myth, it can be achieved with hard work and dedication.Perpetual wealth requires you to be willing to take risks (calculated ones) and be creative in your investments. While there are no guarantees that you will achieve perpetual wealth, following these two steps will help reduce the risk of failure:
Start saving early in life so that you have more time for compounding interest on your savings.
Pay off any debt as soon as possible so that you don't have to pay interest on borrowed money.
These two are like the foundations; saving early and avoiding bad debt.
When we look at what it takes to achieve perpetual wealth, it isn't so much about how much you make, but how much you save and invest.
Investing is important because as your money grows over time, the compounding effect will increase your nest egg faster than if you spent it all right away.
In other words, investing is an effective way to grow your money over time. Saving is also important because saving allows you to build up a reserve in case of emergency or for future investments.
You need to be saving at least enough money each month so you can cover all of your expenses plus some extra cash on hand just in case something unexpected happens.
Cash Flow And Having Assets That Constantly Print Out Money
Cash flow is the amount of money that comes in each month and assets are things you own. If you have an asset that prints out money, then the cash flow can be practically endless i.e perpetual.You can build assets by buying stocks, crypto, real estate property, precious metals or even start your own business. There are many assets out there. But all assets must have at least one of these two characteristics; increase in value over time and provide an income/dividend.
The ideal is to have an asset that does both, a common one is a real estate property. That's why it is loved by the wealthy. It is said that a decent percentage of their wealth is tied in real estate.
Having An Income That Far Outweighs Your Expenses
The first step in building wealth is to have an income that far outweighs your expenses. This sounds like a no-brainer, but it's surprising how many people don't have this on lock.Many people live for today and spend every penny before it comes in, so they never leave themselves with any money left over at the end of the month.
Others save for retirement, but don't save for anything else and wind up with nothing left over when something unexpected happens.
Now that we've put out the skeleton/framework of perpetual wealth building, let's now add the flesh and animate it by putting the pieces together.
First it's saving then it's buildling/investing into assets. The more assets you have, the more cash flow you bring in. This cash flow can be used to invest into more assets provided that your expenses are already taken care of. The more cash flow generating assets you have the more perpetually wealthy you become.
Remember, Perpetual wealth doesn't mean having more money. It's having assets that constantly 'print out' money. As long as you have those assets, you will be perpetually wealthy and have perpetual money.
This sounds simple and it is indeed simple but IRL, it's a long process and there's a mindset to it.
Thinking Long Term Rather Than Short Term
Perpetual wealth builders have a plan for the long term and they stick to it. They don’t get distracted by short term opportunities, because they know that these will not lead them anywhere but to financial ruin and regret at some point down the line.The best way to build wealth and become a perpetual wealth builder is by building your business (career is out the window) in such a way where you can create multiple income streams that last over time, rather than focusing on just one source of income which could end up failing at some point in the future.
Years Down The Road
Wealth builders know where they want to be in five, ten or even twenty years down the road. They have a long term vision of what they want to achieve and they work towards it.They know that having a long term plan is important. It helps them stay focused on their goals and keep working towards them.
Setting goals is also very important for wealth builders because it keeps them motivated and gives their lives meaning in a sense that there's something to work towards rather than daydreaming or idling through life.
Final Thoughts
A great deal of research has been conducted in recent years on the topic of financial success and what factors contribute to it.A lot of people have come to the conclusion that there are no shortcuts and that it’s all about hard work, dedication and perseverance. The real difference between perpetual wealth builders and those who don’t get as far financially is mindset.
It may sound simple, but staying positive is one of the biggest elements to having a winning mindset when it comes to financial success.
To stay motivated during difficult times, think back on past successes instead of dwelling on past failures; this will help keep your mind focused on positive outcomes for your future endeavors.
Here's a quote I read a few years ago that nicely fits with the topic of this article.
Work brings money. Money buys assets. Assets bring wealth. Wealth buys freedom.
Thanks For Reading!
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