From Consumer to Wealth-Builder

Article contributed by Wendy Lyon. Come hear Wendy speak at the 4th Annual New Year, New You Conference and Fundraiser to Fight Human Trafficking.  Register today! 


Consumer: Comes from the word, "consume." Webster defines it as "to take, to do away with spend squander." The term implies that our purpose in life is to consume!  
Wealth Builder: Lives well below their means. They save an average of 15% to 20% of their annual income.  They allocate time, energy, and money efficiently – in ways conducive to building wealth.
Buys items on credit. Not only pays exorbitant interest charges but spends over twice as much (112%) as someone who pays cash for purchases.
Buys everything with cash. Often receives a significant discount for using cash. If the funds aren't there, they either do without the item or wait until they have they money.
Buys on impulse. Their attic/closet/garage is full of last year's impulse purchases.  These items either end up getting rhrown away or sold at a garage sale for pennies on the dollar.
Plans purchases and considers the impact on wealth building goals. Buys items that "consumers" sell at garage sales for pennies on the dollar.
Spends every penny earned each month. Stresses over the fact they aren't making enough money.
Lives on significantly less than they make. Saves a large portion of their income every month.
Influenced by peer pressure ("keeping up with the Kardashians"). Believes displaying social status is important to financial independence. Buys a bigger home, new cars, expensive clothing – all to appear affluent and successful. Lies awake at night worrying about money and how they'll pay their credit card and other bills.
Believes true net worth is more important than social status. Pays no attention to the "Kardashians." All purchases are based on value, rather than appearance.  Also believes living a fulfilling, stress-free life is more important than the "status quo" or the media's version of success.
Spends little or no time on establishing a wealth building/retirement plan. Plays the lottery in the desperate hope of striking it rich someday.
Spends a significant amount of time planning their financial future. Has specific wealth-building goals and has a sound investment plan to reach those goals.