The 5 Mindsets That Separate the Rich From the Middle Class

The wealth that separates the rich from the middle class is HUGE.

To be middle class in the United States, you need to have a household income of about $78,000 per year. Meanwhile, if you want in the top 0.01% of the wealth, you need to be making about $1.4 Million per year. That means that the rich earn about 18 times more money than the middle class.

Luckily, it is possible to break out of the middle class and into the ranks of the rich.

Those who are earning huge money aren’t geniuses. They don’t have any magic tricks or secret advantages. They just have the right mindset.

Here are the 5 mindsets that separate the rich from the middle class.

Saving vs Investing

When you have extra money, there are two main choices of what to do with it.

The middle class saves their money by putting it into a regular bank account…. This is a terrible strategy.

If you put your money into a regular bank account, then it will actually be losing buying power to inflation. The effect of inflation is that the price of goods and services goes up. For example, a carton of eggs costing $4 today might be priced at $5 next year.

If you keep your money in a bank account, you won’t be able to buy as many eggs next year. The price is going up but your dollars are staying the same! In order to maintain the same buying power, your money needs to increase at the same or a higher rate than that of inflation (historically, about 3.24%).

The rich are always investing their money. That is, they buy assets that will increase in value faster than inflation does. For example, if you buy a stock for $1000 in 2020 and by the year 2021 it goes up by 10% you now have $1100.

Your money is gaining buying power. Plus, once you buy your assets, you really don’t have to think about them anymore until you sell. They make you money while you sleep.

Fixed vs Constant Learning

Many people, especially those in the middle class, have been led to believe that learning in life is fixed.

Fixed learning means that you learn new things as a specific means to an end. You get your degree to get a job. You get a new certificate for a specific promotion. You learn Spanish because you’re going to visit Spain in 3 months.

Having this mindset about learning is very limiting because you only ever learn certain things at certain times in your life. You shouldn’t only take new courses when you’re looking for a new job — by then it’s too late. You shouldn’t only learn the technical skills in the job description — that totally misses important soft skills.

The rich fully understand this and instead look at learning as a constant, life-long effort. Learning is not something done for a specific job or event, it’s a part of daily life. They’re always taking courses, reading books, networking, and seeking out new experiences. This results in constant growth which will get you a lot further than just learning every once in a while.

Scarcity vs Abundance Mentality

If there’s one thing that blocks those in the middle class from upgrading their financial status, it’s a scarcity mindset.

To have a scarcity mindset is to think that there isn’t enough room for your success. For example, to think that all of the higher-up positions in your company are filled or that all the good business and blog ideas have been taken.

That mentality is so limiting!

You’re setting yourself up for failure before you even begin. If you don’t believe that you can make it, then you never try. And if you never try, you have a 0% chance of ever succeeding.

The rich have a mindset of abundance.

Having a mindset of abundance is the firm belief that there are always plenty of opportunities for success. There’s plenty of space in the market to start your business, plenty of areas in your current company or other companies to get promoted, and plenty of opportunities to make more money.

In order to seize the best opportunities, you must first be open to them. That starts with an abundance mindset.

There is always a way to win.

The resourceful person, the one who is determined and proactive, is the one who will find the best opportunities to grow and move forward. This is the mindset of the rich.

Follow vs Break the Rules

People who are in the middle class are always following the rules. They wait for their yearly review to ask for a promotion or a raise. They don’t talk to that cute girl or guy across the room, they hope that they will come over. The businesses they create are just copy cats of others already in the market.

This way of working is too slow and too weak.

If you always follow the rules, you’ll never be able to move fast enough.

A yearly increase in income will take you forever to get to a level of financial independence. Always waiting for other people to make the first move will leave you disappointed.

If you want to grow fast and achieve big success, you’ll have to take what you want when you want it, even if that means breaking all the rules.

Go for that promotion and raise when you feel you can get it, as early as you can. No one is going to send you to jail for asking for a raise.

Talk to that cute girl or guy across the room. There’s always a chance you two hit it off and have a great time.

If you think a wild business idea can work, ignore the naysayers and make it happen.

As soon as you decide you want something, go for it. Fortune favors the bold. If you want to have an awesome life and make an impact, then you must do things your own way, with courage.

Rules are made to be broken.

Trading Time vs Value for Money

Most people believe that the only way to make money is to trade their time for it. They work full-time jobs for a fixed salary or go freelance and get paid by the hour.

The problem with this strategy is that your income potential will always be limited. Even if you’re a top contractor, think about how much would someone reasonably pay you by the hour.


$1000 maybe if you’re a top lawyer?

But still, you hit a limit on the amount of money you can charge and the number of hours you can work. It’s a middle-class strategy.

The better strategy of the rich is to make money based on the value you create. This is the way of business owners and content creators. You create assets such as YouTube videos, blog posts, tech intellectual property, or some kind of product, and then sell it to everyone you can.

This method is scalable because it is totally independent of time. Once you create the value, you multiply it simply by selling it to more people. In this way, your income ceiling is unlimited because the value you can deliver is unlimited too.

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