Three ways to build wealth
Seek wealth, not money or status
Robert Kiyosaki had two dads. Poor Dad was his biological father and Rich Dad his friend’s father. Poor Dad was highly educated and believed in following society’s norms. Get a good education. Work in a secure job. Avoid financial risks. However, despite adhering to these beliefs, he struggled financially, particularly later in life. By contrast, Rich Dad was an entrepreneur. He valued a financial education, investing and making money work for him, not vice versa. Rich Dad ran his own business, employed others and built cash generating assets. With this approach, he became wealthy. Robert’s book, Rich Dad, Poor Dad, drew my attention to the radically different financial prospects relating to opposing mindsets. The core is understanding the difference between money and wealth; and how to build the latter.
Money
Money is merely a symbol of value, not the value itself. - John Locke
The words money and wealth are used interchangeably, but they relate to different concepts. Money is a medium of exchange that allows people to trade goods and services. It is a representation of value but does not hold intrinsic value itself. Governments print money, central banks regulate its supply and inflation affects its purchasing power. Because money is liquid and easily transferable, it is a useful tool for transactions but not a measure of financial independence.
Many people equate having a high income with being rich, but a high salary alone does not lead to lasting wealth. Without the right financial mindset, even large amounts of money can be lost quickly. Lottery winners often squander their riches.
Wealth
Wealth is not money. Wealth is businesses and assets that earn while you sleep. - Naval Ravikant
Wealth, on the other hand, consists of assets that generate income over time. It includes businesses, stocks, physical and intellectual property plus systems that continue to create value. Unlike money, wealth is not easily depleted; it compounds and provides long-term financial security.
Wealth is built through a combination of ownership, leverage and systems. Ownership of equity in businesses, stocks or other appreciating assets lays the foundation by giving a stake in value that grows over time. Leverage amplifies that growth by using capital, technology or media to scale income beyond what’s possible through individual effort alone. Finally, systems and automation ensure sustainability and expansion, enabling scalable or passive income through efficient processes that require minimal day-to-day involvement.
Building wealth
Wealth is not earned, it is created. - Grant Cardone
Wealth and money are not the same. Money loses value over time while wealth (like appreciating assets) grows and provides financial freedom. Wealth generates passive income, reducing dependence on active work. Without converting money into assets, even high earners risk financial ruin.
The main ways I build wealth are:
Develop commercial skills: Learn skills that allow participation in wealth-generating opportunities, such as business ownership and investing.
Create assets: Instead of relying solely on a salary, invest in assets that generate long-term income.
Think in terms of compounding: Build systems where effort and capital generate returns over time, rather than chasing quick gains.
I love learning and applying technical and financial knowledge. I setup a company, invest in shares for the long term and create digital assets, including this blog and apps.
Other resources
Rethink Money talk by Robert Kiyosaki
Eight Steps to a Better Financial Future post by Phil Martin
Five Ways to Build Specific Knowledge that Gains Wealth post by Phil Martin
To wrap it up, Robert Kiyosaki says: Financial freedom is available to those who learn about it and work for it.
Have fun.
Phil…
