High Income Vs Wealth

And if you think income inequality is bad well you ain t seen nothing yet.

High income vs wealth. The main point here is that while a high income gives you the potential to create great wealth it usually doesn t go that way. In a follow up piece dqydj graphed the correlation of income and wealth by age. An individual can be a high income even very high income but even not be wealthy. Although most people would agree that society should aim to be more equal complete equality within a capitalist society is not.

Wealth is certainly influenced by income a higher income may make it easier to save and thus easier to become wealthy but it is not directly linked to income. Wealth has nothing to do with high income. Wealth is made up of a diverse list of assets which work together to provide us with options and resources to live a better life. Further a high income does not guarantee wealth.

If you look at the 100 000 income level in the chart for instance folks have net worths ranging from 1000 to 10 000 000. It requires a conservative long term mindset. It all depends on how a person manages his income. Income decides your standard of living but wealth gives you control over the shape and future course of the economy.

Many people are striving for high income and are neglecting their net worth. High income recipients generally have high ethics and standards of living which make them devote more although many earn a smaller amount of income but may save more and gain wealth. While income is generated wealth is created there is a big difference between two many think that these two terms are one and the same thing but in reality income is a stream of money which a person receives from different sources such as salary rent profit interest etc that helps in the creation of wealth and wealth is the total market value of all the assets possessed stored or. High income earners usually have high standards of living which make them spend more while there are many who earn less income but may save more and acquire wealth.

For any given income level people have a huge range of net worths. Building wealth does not require a large income. Income is earned immediately but wealth can take a few years to acquire. That said people with higher incomes do tend to have greater wealth.

Income and wealth inequality are issues in scotland and the uk. I haven t seen any evidence on why this is the case other than over spending when it seems like a high income would almost guarantee wealth. This simplified illustration helps to clarify the differences between wealth and income. The answer is wealth.