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Middle-class poverty and how to escape the ‘rich dad, poor dad, same dad’ syndrome – Nairametrics

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Poverty comes in different shades and types and depending on where you are, you will be threatened by a certain type of poverty. There are three types of poverty and each of them threatens a different class in society – the lower class, the upper class, and the middle class.

Lower class poverty

Lower class poverty is called the capacity deficient poverty. This poverty is caused by a deficiency in the capacity to create wealth. No poverty is too strong to hold a person of high capacity bound for a very long time. That is, regardless of where they live, the circumstances of birth or childhood and the opportunities that are available to them. People of high capacity create their own opportunities and innovate their way out of problems. They can thrive with little resources and manufacture their own success from it. This is how the popular grass to grace stories was created. And this is how a sizable number of the world’s wealthy people created their wealth. They created it against all odds. Today there are many more wealthy people who made their wealth from scratch than there are people that inherited wealth. What this means for you, is that you can begin from where you are today and end up in a better place. Yet without capacity you can’t do it. And capacity here means three things. The first is a Wealthy mindset. You must be there in your mind before you get there. The second is high-income skills. You must lift the ceiling off your income and earn the freedom to earn from many sources. And third is Rich relationships. You must develop the skills to form relationships that can open doors for you. Thus, to get out of lower-class poverty you must upgrade your capacity

Wealthy class poverty

The wealthy class also have their version of poverty. Their version is called the Low standard poverty. Wealth in the wealthy class is created by maintaining certain high success standards and living a disciplined lifestyle. No undisciplined and low standard person can create wealth. Thus, poverty in the wealthy class is caused by the reduction, change or neglect of the high standards that got you there. Maintaining high standards for a long time under a disciplined environment takes a lot of hard work. Thus, the temptation is to relax a little, reduce the standard and enjoy life once wealth is created. This is the fastest way to go down. Thus, the secret to falling from the upper-class when you get up there is to change the standard or formula that got you there. While Failure is the reason for success, success is also the reason for failure. So, when you get up there you must discipline yourself to maintain success standards. And create a financial wedge system that can perpetually sustain you at the top.

Middle class poverty

The final type of poverty is the middle class. And middle-class poverty is called passive income deficient poverty. Middle-Class Poverty is caused by the failure to fully transfer one’s livelihood from active income to passive income before retirement. That is the kind of passive income that can sustain your living standard. Middle class poverty is the reason for the financial disease that plague 80% of the middle class today. It’s called the Rich dad, Poor dad, Same dad syndrome. Unlike the popular rich dad poor dad story by Robert Kiyosaki which comprises two dads. Most middle-class families have a rich dad and poor dad in the same dad. This means that the same dad was rich when the children were growing up and became poor when the children grew older.  Children are having to watch their parents deteriorate from a prestigious and high-quality life into a low-quality life in retirement. Research shows that about 80% of today’s working class will become poor dads in retirement. That is after having a seemingly successful career. If you want to escape middle-class poverty and remain a rich dad all your life you must do certain things differently. Whatever you are doing and whatever 80% of the population is doing and have always done is wrong. How else would you explain the many ex-working professionals who lose their financial dignity in retirement? To end up in retirement as a rich dad you must build passive income that is not just stable but able to carry the weight of your living standard and future aspirations.

Investment One

So how exactly do you achieve this?

There are three things you must do.

The First thing is to increase your earning capacity. The second is to save big portions and the third is to build the financial freedom passive income.

Increase earning capacity

There is little you can do with a low income or a high income that is terribly overwhelmed by expenses. The lower your investable income the longer it will take for you to achieve financial freedom. Also, you may never achieve it as you are caught in a constant battle between meeting today’s pressing needs and tomorrow’s financial security needs. Thus, to achieve financial freedom your current life must be stable and free from enormous financial pressure. This is because financial freedom is a long-term pursuit. And no one can put money aside long term if their current life is on fire. Thus, the first goal for you if you are not yet financially stable is to achieve financial stability. If you on the other hand you have a stable financial life the next goal for you is financial freedom. To achieve financial freedom, you cannot depend on income alone. You need the second component which is to save big portions of your income.

Save big portions

Big portion saving is saving that preserves a sizable amount of your income for financial freedom. And there are three levels of big portion savings to achieve. The first is the basic level savings. This is where you save 25-30% of your income each month. When you invest this amount the way that I will teach you, you will create passive income worth 20%-25% of your current income. This means that your total passive income at retirement would be 40% of your current income. That is if pension provides the remaining 20%. This is a better place to be in than most people will ever be.

The second option is the Advance savings option. This is where you save 40%-50% of your income. In exchange you get passive income that is worth 40-50% of your current income. This means that you will be able to retire to passive income worth 60-70% of your current salary. A better outcome than what you will get with the basic savings option.

The Third option is the supreme savings option. This is where you save 60% -70% of your income by finding other extra sources of income to support it. Invested the way that I teach you will produce passive income worth 60-70% of your current income. Which brings your total passive income to almost 100% of your current salary. This is the way to end up in retirement as a rich dad.

Build financial freedom passive income

The Third and Final step is to invest the financial freedom way and to build passive income that can give you financial freedom. To achieve this, you must choose investment vehicles that have the following three characteristics. The first is passive income production ability. To sustain your living standard in retirement you will need investment vehicles that can produce passive income that is worth the same or more than your current income. This is because Life does not get cheaper as you grow older. It gets more expensive. If you look at your own life this is likely to be the case. The second characteristic is recurring stability. Your passive income must not only have recurring income it must be stable. You must be able to build passive income that replicates the good sides of salary. That is, it must come in every month, it must come in unfailingly, you must know when it will be coming in, the amount that will come in and the time that it will come in – end of the story. If you have passive income that does not have these characteristics you will suffer financial anxiety in retirement. The final characteristic your passive income must have is that it must last for a lifetime. Unlike your salary your passive income must never retire or run out on you.

If you need help creating this kind of passive income and escaping middle-class poverty, Send an email to [email protected]


About author

Ever heard of The Rich Dad, Poor Dad, The Same Dad Syndrome. A situation where the same Dad was rich when you were growing up and poor when you became Older. That is the fate of 80% of working professionals today. My goal is to help you Escape it. Grace O. Agada is the most sought-after Financial Planning expert in Nigeria. She is a renowned Author, Financial Expert and Keynote Speaker. Grace is Popularly known as the Upper-Class Mentor and Her goal is to help working professionals escape middle-class poverty and transition to the upper class. Grace is the Author of three books and possibly the most widely read financial articles. Her articles are spread across seven national newspapers and four of the most popular Nigerian Blogs. Grace is also the Founder of the University of Wealth, The Rich Retirement Bootcamp, and the Wealthy Business MBA Program. Grace has been featured on BBC Africa. Business Day TV. Inspiration FM. and inside Naijatv. And she consults for Numerous Top Organizations, Company Directors, CEOs, Senior Executives, and High-Income Professionals.

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