Are you wealthy or just rich?

Azzad Asset Management - Bashar Are you wealthy or just rich?

Bashar Qasem, CSAA, President and CEO

“If the son of Adam had a valley full of gold, he would like to have two valleys.”

– Prophet Muhammad (peace be upon him)

As a financial advisor going on twenty-five years now, I’ve seen and heard a lot. This ranges from inspiring stories of financial success to stories with less fairy-tale endings. The latter cases often involve those who just can’t seem to grasp what it means to be wealthy. 

There’s a difference between being rich and being wealthy, of course. I’ve seen many clients with large account balances who are unable to enjoy life. I’ve also seen people of more modest means without a care in the world, living life to the fullest. 

Being rich is basically a function of how much money you earn, while being wealthy is having the freedom to do what you want with your time. 

Many rich people spend their money on material things. And often their sense of self-worth is derived from these possessions. This is something I’ve seen firsthand as an adviser over the years, as well. These are the people who need everyone around them know how “successful” they are.

Contrast that with wealthy people, or those who concentrate on accumulating wealth to free themselves up for other pursuits. These people are focused not on how others view them, but on what their money can provide them in terms of peace of mind and security. Their goal is to save, invest and accumulate wealth not to impress anyone, but to achieve financial independence so they can enjoy the benefits of having money. This can mean different things to different people: a stress-free retirement, the ability to be philanthropic, the ability to take care of family or the ability to travel and create experiences. 

People who are actually wealthy have bought into the keys of wealth accumulation. Based on my experience, these keys include:

1. Living below your means

2. Staying away from debt

3. Saving and investing with purpose

Let me take a moment to address that first point. Look, I get it. We live in a consumer-driven economy. We are constantly being told that more of everything is the path toward happiness. But here’s something I’ve learned over the years in this industry: Chasing money for the sake of money itself in this life leads to financial anxiety, whereas chasing the real reward of the hereafter leads to financial contentment and peace of mind.

The Prophet (peace be upon him) once said, “Compare [yourself] to those who are lower than you [in wealth] and do not look at those who are above you [in wealth], for it is more suitable that you do not discount the blessings of Allah.”

Contentment can make us all wealthy–both in this life and the next.

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