Higher income doesn't build wealth if you spend raises on status goods instead of investing. The speaker explains why people mistake spending for wealth and argues that sacrificing short-term status for long-term compounding is the actual path to getting rich.
Your income went up, but your wealth didn't, and here's why. You invested the money into status rather invested the money into wealth. Most people, when they earn more money, invest it into things that give them the illusion of wealth rather than actually build wealth. The illusion of wealth is nice clothes, nice cars, a nice house. Whereas actual wealth means at first you look poorer because you're not spending the money, you're putting it into investments that are going to compound over the long term. There is a sacrifice of status in favor of wealth for a long time, and that's why wealth isn't sexy for a very long time. People who are impatient invest their money into status seeking behavior rather than doing the boring stuff that compounds over many, many years. But those who give up status in favor of wealth tend to get both over time.
