Do You Know the Difference Between Being Rich and Being Wealthy? Ep #195

Do you consider being rich and being wealthy the same thing? In the book by Morgan Housel, The Psychology of Money, the author argues that these words mean 2 different things. In this episode of Retirement Starts Today, we’ll explore the difference between rich and wealthy as well as the connotation of the word money.

Outline of This Episode

[1:42] A review of the psychology of money
[4:30] The difference between being rich and wealthy
[6:13] How to declutter the filing cabinet

Thank you for 1 million downloads

I want to thank you all for helping me hit an exciting podcasting milestone. In May of this year (2021), we hit 1 million lifetime downloads. Wow! When I started this podcast several years ago I was thrilled to reach 100 listeners a month, so this kind of reach boggles my mind. Thank you for joining me on this journey.

To celebrate this milestone, I have an extra heaping helping of retirement headlines today. Both articles hail from the Wall Street Journal. The first article, written by Jason Zwieg, is a review of the book, The Psychology of Money, by Morgan Housel and it explores the different mentalities of the rich and the wealthy. The second article will reveal the best way to declutter your filing cabinet.

The Psychology of Money

Have you ever thought about what money really is? Money is more than a way to show the value of things. Money is also a carrier of emotion, ego, hopes, fears, dreams, heartbreak, confidence, envy, surprise, and regret. There is so much of ourselves that we wrap up in the concept of money.

This is one of the central arguments in Morgan Housel’s new book, The Psychology of Money. The author juxtaposes two stories of two different men with two very different outlooks on money, and in doing so, he reveals that great fortunes can be built from old-fashioned values like delayed gratification.

Have you ever thought of money from a values perspective?

What is the difference between being rich and being wealthy?

Housel explores the differences between those who are rich and those who are wealthy in his book. He describes being rich as having a high current income and being wealthy is having the freedom to choose not to spend money. He explains that many rich people aren’t wealthy because they spend much of their high income to show others how rich they are.

How the difference between rich and wealthy can figure into retirement

“The ability to do what you want, when you want, with whom you want, for as long as you want pays the highest dividend that exists in finance.” This is what many people are looking for in retirement. Most people think of retirement as a time when you stop working, however, retirement could mean, “the ability to do what you want, when you want, with whom you want, for as long as you want.”

What are you looking for in retirement? Are you ready to give up working completely or do you simply want more freedom and flexibility?