Welcome back to Mid-Week Meditations, Lifehacker's weekly dip into the pool of stoic wisdom, and a guide to using its waters to reflect on and improve your life.
Tagged With wealth
Welcome to Lifehacker's weekly round up of all things Bitcoin, altcoin and cryptocurrency. Bitcoin Mania has certainly died down, two months into the year, but there's still plenty of news about regulation, new technology and rival cryptocurrencies to sort through.
Here's the big news in Bitcoin this week.
Last week, personal finance site Financial Samurai posted a blog that went viral: Scraping By On $500,000 A Year: Why It's So Hard For High Income Earners To Escape The Rat Race. If $500,000 is "scraping by", it's time for some serious financial literacy.
Baby boomers, those aged between 45 and 64, may make up less than a quarter of Australia's population but they hold more than half of the nation's wealth. That's according to a study by McCrindle Research, which broke down the household net worth of different generational groups as well. We also found out that the top 20% of the richest Australians hold 62% of the country's private wealth while those at the bottom end of the scale have less than 1%.
To save money and grow your net worth, you have to spend less than you earn. Earning more money will get you further than simply being frugal and spending less of it, but frugality is still a crucial part of the equation.
You've probably seen articles detailing what Warren Buffett does every day, or what Elon Musk eats before noon, or that "one trait" rich people have that poor people don't. It's interesting, but when it comes to building wealth and success, these habits don't teach you anything about what it really takes to get there. In fact, they're kind of counterproductive.
When politicians talk about tax and fairness, it's easy for them to point out undeserved loopholes benefiting the wealthy, or multinational companies. But the elephant in the room is the difference between those who own and those who rent (or have recently bought and have huge mortgages) the house they live in. The tax advantages of housing offend against justice on every count: they place financial stresses on the poor, they are unequal, and the increase in price is not deserved.
A higher salary will do more for your finances than pinching pennies ever will. However, if you don't learn to be frugal with a little bit of money, you'll probably end up with the same financial issues when you start earning more. Or, as financial author Patrice C. Washington puts it, "how you manage $100 is likely how you'll manage $100,000."
