Life is interesting because there is no such thing as slowing down. Things start to fall apart when you take your eye off the prize.
To have long-term success, whether financial, career, or relationships, you must constantly learn, grow, and build.
Nowhere is this more evident than with the class system in America. Inflation will hit middle and lower-class residents the hardest, so what can you do about it?
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Welcome back to the Inflation Ate My Paycheck 101 Series (101, 102, 103, 104, 105, 106, 107, 108, 109), where we combat the devastating effects of rising prices.
What is the middle class? You do not determine being middle class by fitting people into a salary range—it is a mindset.
The poor person’s middle is to get things for free and live off of someone else, either their family, friends, or the government. Poor people often try to get rich quickly through lawsuits, lottery, or inheritances.
Few people have the rich person’s growth mindset of constantly learning from mistakes, growing, reading, building, and adding value.
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The middle class is the most dangerous mindset of all three because it leads to long-term complacency. Most people in America think they “are good” and don’t have to grow or improve—this is how inflation gets them.
The education problem. Most of us don’t want to go to school once we finish. We made it through high school, college, or higher education, and we don’t want to pursue anything further.
However, when we stop going to school, we also stop our self-education. We fill our time with kids’ events, NFL games, and shopping.
The problem with not learning is that the world is much more complex than it seems. There is a reason mortgage rates increased from 3% to 7% in less than a year.
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Why did the price of chicken increase more than pork? More importantly, how can I benefit from insane gas prices? Which companies will outperform after the recession?
The middle class believes they can work their jobs, have a nice home, two nice cars, put their kids through college, and afford to retire—all this in one lifetime. Unfortunately, the American Dream costs $5 million.
The middle class vs. inflation. Inflation is destroying the middle class. Credit card debt is at an all-time high, and things will only worsen.
Poor people are used to being poor. They will leverage the government to stay afloat. However, they do not compete against each other like in the suburbs; we call this keeping up with the Joneses.
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Rich people own assets! Their assets, such as houses, stocks, and businesses, increase in value in an inflationary environment. For example, they can raise rents to match a red-hot rental market.
Now, back to the middle class. The most dangerous mindset is when we believe we have enough money. I am not saying that we always need more stuff, but we always need to produce more cash flow.
Is $75,000/year enough money. As I wrote in “Is $75,000/year the Magic Happiness Number?” There is a limit to how much money you need.
However, the minute you stop earning more money and “settle,” the world changes. As people talk about quiet quitting or leaving their jobs, we see 8% inflation every month. Be very careful.
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I’m not a huge fan of social movements encouraging others to find “satisfying jobs or careers.” You don’t walk in as an entry-level person and “make a difference.”
True satisfaction comes from knowing where you belong in life. Too many people believe they belong in the middle class when it doesn’t take much to become rich.
The path to wealth. Being rich doesn’t mean you earn more money than the middle class; it means you take your money seriously.
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Wealth is having excess income versus expenses. Therefore, you are wealthy if you make $75,000/year and save $30,000.
Let me ask a more profound question. Let’s say you earn $75,000/year working remotely. You can live in San Diego and barely scrape by, or move to Alabama and have a great, low-stress life. Which would you choose?
These scenarios are what keep people firmly in the middle class. Why would you choose to live paycheck-to-paycheck? Why do I see people driving expensive cars while living in California?
Inflation is coming for you. If you are not investing in assets like dividend-paying stocks, you will have a hard time.
You cannot exchange your time for money for an entire lifetime and get ahead financially. There simply is not enough time to earn a fortune on your own—you’ll need help.
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If you are tired of struggling, that is the first step to making a change. Use your Struggle-mania to push you to learn.
If you can make reading into a daily habit, you can start working towards a better life. You will need to learn their intricacies to obtain assets that can beat inflation.
The main ways to beat inflation are: to reduce expenses, increase employment income, budget, save, dividends, rents, royalties, and business.
Each one of these steps requires knowledge and action. Are you ready to put in the time to improve your job skills, budget your money, and invest in the stock market?
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Conclusion. Most people want the results of owning an online business without putting in the work. Sadly, life doesn’t work this way.
Your middle-class buddies will occupy your time talking about the NFL and politics; however, that is not the path to becoming wealthy.
Coming home from your day job and working on your blog is the way to becoming rich and beating inflation.
The Sharing Economy vs. Inflation
I hope these words find you well. Don’t settle for a middle-class life just because everyone else does it. It’s okay to want more from your life.
We live in a country with limitless opportunities; why settle for working 9-5 and living paycheck-to-paycheck? Inflation didn’t just happen; it came from somewhere.
Once you understand where recent inflation originated, you’ll appreciate the higher purpose of striving to have more in life. You’ll see that your misery will never end unless you make it stop. Good Luck!
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Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
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