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Monday, 12 November 2012

Rich and wealthy ? 你是哪种类型?(文章转贴)

Rich or wealthy – which are you?

MONEY & YOU BY YAP MING HUI。





IN recent years, the level of household debt among Malaysians has been a matter of growing concern,
as the statistics show that the average person is way over his head in debt.

Based on Bank Negara figures, the typical household borrowing
is a shocking 140% of disposable income.

That's something to think about, as it means that at least half of Malaysians are struggling desperately
with their finances. So, they probably have very little idea of
how they can become financially free, let alone wealthy.

Incredible, isn't it? Most people we know would like to be free of financial worries and
to enjoy a high standard of living, but so few seem to get it right.

The journey towards financial success begins by first knowing where you are.
Strangely, many people in the middle class find it difficult to answer this question:
are you middle class, financially free or rich?

In my latest book, Set Yourself Free: How To Optimise Money and Become Wealthy With Minimum Effort and Risk,
I have talked about the money matrix, an intellectual tool that I have developed to help you understand
the state of your finances and how you can move towards financial freedom, and eventually wealth. (see chart)

Think about the various elements in the money matrix for a while, and let the ideas being discussed here
get absorbed into the way you look at money.
How you view these situations will determine what you do to achieve your goals.

The vertical axis denotes your ability to generate an active income, which is described as your money-making ability.
The higher your money-making ability, the more income you generate.
You can take steps to increase your money-making ability by focusing your time,
resources and effort on the area that you do best.

Compared to a general practitioner, a heart specialist is able to generate a higher income.
Likewise, if you are a small business owner, you could concentrate on becoming a market leader in your industry.

Most people find it relatively easy to increase their money-making ability.
In fact, some people become absolutely driven by it, thinking that it is the only way to resolve all their financial concerns.
If you are wondering why so many people are constantly chasing their financial goals, but never seem to reach them, that's because they are focusing on making more money but not on optimising what they have!

People who adopt this mentality will always be stuck in the “rat race”.
They cannot afford to stop working for fear that they cannot maintain their present lifestyle.
If you are one of these people, it may be time to re-evaluate your priorities.

Money optimisation, as measured on the horizontal axis of the money matrix,
reflects your ability to turn your active income into assets and then using those assets to support your
lifestyle in the optimal manner.
In other words, money optimisation is about making your accumulated assets work for you.
The higher your money optimisation ability, the more assets you will accumulate and preserve.

To achieve financial success, you must fully understand how money making and money
optimisation interact with each other. Let us look at the various sections in the money matrix:

Poor: You are in this group if you have low money-making ability and low money optimisation ability.
Your income is low and you spend most of it on your living expenses.
If you lose your current source of income, you risk being unable to look after your basic living needs.

Middle Class: In this group, you have medium money-making ability and low money-optimisation ability.
Your income is above average but you spend most of it on a comfortable lifestyle.
If you lose your current active income, you risk being unable to maintain your lifestyle.

Rich: You have high money-making ability but low money-optimisation ability.
Your income is very high but you spend most of it on a luxurious lifestyle and your financial resources are not optimised.
You will not be able to maintain this lifestyle if a financial disaster strikes and you lose your current active income.

When we understand the behaviour that puts us into one of these three categories,
we will be able to take the right steps to optimise our money. Now, let us look at the column on the right,
which shows the financial health status that a person can work towards:

Self-Sufficient: If you have low money-making ability but high money-optimisation ability,
you can be in this category. You may have a low income but you manage your finances very carefully.
You may live a simple life, but you do not have to depend on anyone else for your survival.

Financially Free: If you have medium money-making ability but high money-optimisation ability,
you can be in this group. You control your expenses so that they do not grow in tandem with your increasing income.
Instead, you focus on saving or investing your extra income and as a result,
you manage to accumulate a reasonable size of assets to maintain your current living standard.

Wealthy: If you have high money-making ability and high money-optimisation ability, you are in the wealthy group.
You have an extremely high income and enjoy a comfortable, but not luxurious lifestyle.
You turn a very high percentage of your income into savings and invest it wisely.
As a result, you generate a huge passive income which is more than sufficient for your living expenses.
In addition, you have taken the necessary measures to ensure that your wealth can potentially last for generations.

The money matrix is, therefore, a guide to help you find out if you need to increase your money optimisation ability
or money-making ability to improve your financial position.
Without fully comprehending these two elements, many people feel lost and focus
on the wrong things in their journey to seek wealth.

Let us take the case of Michael, who has identified himself as belonging to the middle-class section
in the money matrix. Michael wants to get out of the rat race and be financially free.
However, he makes the mistake of focusing solely on his money-making ability to generate more income,
and ignores all aspects of money optimisation. Michael will end up in the rich section.

Along the way, if something were to happen to Michael and he stopped working,
Michael may find himself back at being middle class, or worse, in the poor category.


If there's one thing which could help you achieve financial freedom, and eventually become wealthy,
it would be this: you must not just focus on making more money, but must optimise what you have.

> Yap Ming Hui (yap@yapminghui.com) is a bestselling author, TV personality, columnist and coach on money optimisation. He heads Whitman Independent Advisors, a licenced independent financial advisory firm which has helped people to optimise their wealth and achieve financial freedom since 2000.
http://biz.thestar.com.my/news/story.asp?file=/2012/11/10/business/12287742&sec=business

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