Rich
and Wealthy seem to be the same terms but they both are different by meanings.
Various people make mistakes by considering them as synonyms since there might
be some point in their meanings. If you ask anyone the difference between
wealthy and rich, the person would be blank.
Rich vs Wealthy
The main difference between rich and wealthy is that wealthy people know how to earn more money whereas rich people have only a huge amount of money.
Many
times rich people are happy with the money they have but wealthy people do aim
to create more money by following a passion and their dreams. Rich people might
make a good amount of money but there is some point when it stops.
A wealthy individual properly uses the financial resources so that a person can support living for a long period even if there is no job or work. In all together they aim to generate income regularly.
Comparison Table Between Rich and Wealthy (in Tabular Form)
| Parameter of Comparison | Rich | Wealthy |
|---|---|---|
| Knowledge | Rich people have money | Wealthy people do know ways to make more money |
| Sustainability | people are rich for short duration | People are always wealthy |
| Approach of making money | People work for money | Money works for wealthy people |
| Spendings | People usually buy more than what they have in list | People only buy what is necessary |
| Financial Education | Anyone can be rich | Only Financial educated people can by wealthy |
Who is Rich?
Rich is a quite relative term since it is subjective and would change with change in money an individual has.
For example, if person A earns a million whereas person B earns a few thousands then person A is rich. Some of the factors are there which decides whether a person is rich or not.
- If an individual earns more than the balanced amount, the individual is rich whereas an individual earning less than the average amount decided by the country is not rich.
- Based on net worth, it can be decided whether a person is rich or not. For example, if the net worth of a person is huge including all the assets and no loan then individual rich. But if the net worth is high and individuals are under loans, then individuals might be richer than others.
A
wealthy person can be rich but rich cannot be wealthy. Anyone can look rich
without having wealth. For example, several celebrities and athletes are
bankrupt but they always display their lavish lifestyle.
Who is Wealthy?
If
a person is wealthy then it means that an individual knows how to make money.
If someone is wealthy, it means, a person would be wealthy forever. Wealthy
people let money make money. Wealthy people have a good amount of knowledge
about finances. They know how to manage their finances.
A wealthy can make different strategies and
work with a mentor to generate more wealth. Anyone can become wealthy with
Knowledge and wisdom. Every individual became wealthy with their knowledge
A wealthy one survives with only the required amount of money rather than overspending on things that are not necessary.
Main Differences Between Rich and Wealthy
An individual becomes rich before and then wealthy.
- A person goes to a good school, gets a good job and follows a career that makes a person only rich.
- Whereas a wealthy person chooses a smart plan and an easy way to earn money in less time. Wealthy people do make temporary sacrifices during the initial time to be wealthy.
Rich people might have a huge amount of money, but they don’t know how to make money.
- Whereas wealthy people do have money-making knowledge and they make more money with money they have.
- Rich and wealthy people can lose their money but wealthy people may use their knowledge to make money again.
Rich people spend more and earn less.
- Rich people do spend on luxuries, despite how much they earn. Many times they get in debt.
- A wealthy person spends only on the requirements. It means a wealthy person earns more but spends less.
Rich people do give celebrity looks, whereas wealthy people have modest looks.
- Rich people focus on big brands since they earn good amounts of money. Whatever rich people earn is temporary since they don’t have any wealth.
- Wealthy people stay away from fancy things and they always try to save money by staying away from big brands.
Wealthy people focus more on savings, whereas the rich focus on spending.
- Many wealthy people do save and invest their money so that it can grow. Most of their spendings are in stocks, investment in reserves, commodities, real estate and many more.
- Rich people mostly spend their money on things whose value is depreciation such as big cars. In order to be wealthy, one should focus on investments such that money earns money.
Conclusion
An
individual must focus on becoming wealthy rather than rich. Since an individual
might earn a good amount of money but a wealthy person earns recursively. It is
necessary to spend less and invest some of the earnings to become wealthy.
One should not be in debt. With money, a rich person can buy anything, but not freedom. Hence you should focus more on being financially free and wealthy so there is no shortage of money.
An individual should not spend all the income and paychecks. One should make wealth by saving money for needs, clearing all the loans. An individual should acquire assets, real estate, entrepreneurship and invest in stock markets.
It
is easy to be rich but very difficult to be wealthy since an individual needs
to sacrifice all the luxuries and expensive lifestyle to become rich and focus
on financial security and flexibility.
References
- https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2893086
- https://www.elgaronline.com/view/edcoll/9781783474035/9781783474035.00023.xml