Mark Moss explains how the wealthy use income to buy tax-advantaged assets that compound at 20% or more annually, while poor and middle-class people earn paychecks, pay taxes, and save leftovers. The money supply grows 10% yearly, outpacing wage increases, so asset appreciation is the real path to financial freedom.
The way that the poor and the middle class mindset works is they look at work as something that they do to make income to pay for their life. And then they're going to hopefully have a little bit left over that they can save or invest. But the problem is they earn, they pay taxes first, then they get to spend what they need for the lifestyle, and then they invest. The way the wealthy do it is they earn money that buys assets. They can use their income tax-free to buy the assets. So now it's growing at twice the rate. Then those assets are compounding and I leverage those assets to pay for my lifestyle. Lifestyle. Right now, the money supply is expanding by about 10% a year. For most people, it's impossible to increase my rate of pay fast enough to keep up with that. But my assets could go up by 20%. So what I want is my assets to go up and fund my life. And I want my income to just be an engine that allows my assets to grow at a faster rate.
