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August 18, 2004:
How Wealthy People Get That Way
Interview
with Stephen Brobeck,Executive Director, Consumer
Federation Of America
Mike
Carruthers:
Research indicates that many Americans are pessimistic about
their ability to build real wealth by the time they retire.
Stephen
Brobeck:
We discovered that even low and moderate-income households
can build significant wealth, six-figure wealth.
Stephen
Brobeck Executive Director of The
Consumer Federation Of America…
It is very
possible for middle income, even a moderate income household
to develop a million dollars in assets if they contribute to
a retirement program at work taking advantage of free dollar
matches from employers. If they buy a home, pay off the mortgage
they don't' borrow the home equity and the value of the house
appreciates significantly and if they save an additional amount.
Only four
percent of Americans are millionaires, that is they have assets
over a million dollars. How did they make it?
A very significant
source was a business. Someone who worked as a plumber, a car
dealer some other small or medium sized business owner. A second
source was stocks and bonds.
But the
important point, Stephen says, is that anyone can accumulate
wealth with some discipline.
The most
important principle is to spend less than you earn and save
the difference. And then take advantage of the miracle of interest
compounding. Which will dramatically escalate the funds that
you have saved.
At somethingyoushouldknow.net,
I'm Mike Carruthers and that's Something You Should Know.
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