7 Things Rich People Buy That Poor Don’t

One of the things that differentiate the rich from the poor is not just the amount of money they have. It’s because they have assets. Rich people buy, own and acquire assets. The middle class buys liabilities thinking they’re assets and poor people only have expenses.

I will share with you seven types of assets that rich people buy, acquire and own. And I’m not going to define assets as in traditional accounting terms. I will define assets the way that rich people see which is very different from how most people see it.

1. Business

The first type of asset rich people have that the poor don’t is business. Almost all rich people either make their money through their companies and business or they have an invested interest in multiple companies or multiple businesses. The only thing poor people have is a job. They have a paycheck at the end of the month.
You will never get rich through a paycheck. You will only get rich through business or multiple businesses. Because it’s the only way you can apply leverage. You can leverage other people’s time, money, resources, and talents to build something, to make your vision a reality.

Your earning ability is not tied to how many hours you work. You are able to leverage 1 to 10 and 1 to 100, 1 to 500 to build a bigger business, to be able to impact more people and deliver more value to a marketplace in exchange of money.

2. Automobiles

The second asset type that rich people buy that the poor don’t, it’s automobiles. A lot of people buy automobiles just for transportation.
But the rich people sometimes buy automobiles for collection because they get pleasure driving them, owning them, repairing them, or selling them.

Buying automobiles properly could be a very lucrative thing to do. Most of the time, rich people just buy them because they have a passion for automobiles or classic automobiles. They do it just for fun. They collect rare automobiles and when they sell them, they do make a nice profit from it. It does turn it into an asset class.

3. Real Estate

This is the most popular asset class among the rich. Most rich people either make their money through real estate or they park or hold their money in real estate. When it comes to real estate there are so many different types of real estate like residential or commercial. Residential is a condo or single family home. Commercial real estate is malls, hotels, offices, multi-family.

Within real estate, you have so many different types of strategies. You could buy and hold, buy and flip or buy and develop. The different types of strategies depend on how much capital you have and where you want to invest.

Many rich people have real estate or they park their money in real estate because the banks, the lending institutions love real estate, they like the security of the real estate. They loan them money to buy real estate, They think that real estate is a hot asset, it’s an intangible asset that they like to lend money on. That’s why a lot of rich people either make their money in real estate or hold their money in real estate.

4. Bonds, mutual funds, and stocks

The fourth asset class that rich people buy the poor don’t is paper assets. Sometimes rich people buy assets because they produce cash flow or dividends. In the case of bonds, mutual funds and stocks, they buy those assets for the hope of increasing in value over time. That’s called appreciation. When it comes to stocks, they buy them at a certain price and they wait until it goes up later in the future. They buy on the appreciation.

Let’s compare paper assets to a piece of real estate. In order to convert a piece of real estate into money, you need to list the property for sale or get a mortgage from the bank, but it will take a lot of time. With stocks, mutual funds, you can sell and turn them into money very easily.

5. Intellectual Properties

Intellectual properties are patents, trademarks, brands, copyright. This is an asset class that rich people love. They own a lot of intellectual properties because they can scale, they can license those intellectual properties to somebody else. The maintenance fee is very little compared to other asset classes.
Disney has a lot of intellectual properties, Coca-Cola as a brand is intellectual property. The brand itself is actually worth more than the actual hard assets that Coca-Cola owns. The brand Coca-Cola is worth billions and billions of dollars.

6. Precious Metals

Precious metals are gold, silver, platinum. Gold is a very valuable metal that’s why rich people like to have their money in gold. Throughout history, gold was the asset class that is recession proof. It’s a very important asset class that rich people trust.

7. Audience

The audience is a new asset class. Attention is the new currency. Influencers in social media who have an audience are able to captivate other people’s attention. Their audience’s attention worths money. That’s how they’re able to generate income and profit. Attention is the new currency because without it you would not be able to get customers. And without customers, you won’t have any sales.

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