The Wealthy are Wealthier, The Poor are Poorer & the Entrepreneur defines their value
Net worth data provided by the New York Federal Consumer Credit Panel revealed something surprising. Credit usage to support 10 year old standard of living is increasing. If you don’t understand the statement it means Americans have to borrow to pay for what they use to have 10 years ago.
On top of that credit card interest rates are at an all time high. The high interest rates persist despite the prime rate being at all time lows.
Americans are struggling to cover their old lifestyle habits.
These facts are not just affecting lower income brackets. The cost of many products and services the upper middle class buys, from automobiles to college educations, is outpacing overall inflation.
Want that new Mercedes Benz you purchased 6 years ago? In yesterday’s dollars it cost more than you can afford. Sorry. Keep driving your old one.
Income stagnation for employee based wages has remained despite price increases in property ownership, consumables, luxury items and property taxes. An analysis of more than 87 million US single family homes by ATTOM Data Solutions found in 2018 property taxes rose by 4% annually (on average). As of February 2019, only incomes among the top 25% of wage earners surpassed a 4% annual basis rate increase according to the Atlanta Federal Reserve.
At the same time company ownership, in public and private companies, has been reduced for the upper middle class. The Federal Reserve tracked the ownership of equities from 1989 to 2018. Do you know what it found?
Americans from the 50–90th percentile transferred asset holdings from 39.0% even to 30.3%.
That is a 21.9% net worth reduction for the majority of our population. At the same time wages have not appreciated nor have benefits increased.
Americans who choose the employment route are getting poor. It’s not the fault of the hard working person. The top 1% has some blame but it’s not all their fault. Technology is eliminating people to do jobs and we have population growth. Manual processes are being eliminated and more people are being born.
I discovered this fact when I was 17. My parents’ mortgage was $1,081 a month. Jobs in my local area paid $7 — $11.50 an hour. I realized if I had a two year degree the most I could get was a management job paying $11.50 an hour. After taxes I would barely have enough for the mortgage and basic necessities. I would not have enough money for gas, food, utilities, car payments, or insurance. It was a depressing revelation. I just wanted to live like my parents (obviously not an impossible task). My father was a machinist out of high school. My father earned about $15 an hour. That was in the 1970’s. You can see the issue with the way things are going.
I chose to be a Professional Entrepreneur because I wanted to set my own value. My time is measured, the cost is analyzed and I go to payors who can afford me (business owners or governments). The reality is the top 1% has a very hard income barrier to crack. The barrier gets bigger every day. Scarcity is the definition of cost. Professional Entrepreneurs are scarce. Scientists are also scarce. If you want to be an employee there is hope. The hope lies in becoming a highly technical specialist. Most people lack the will or intellect to become a PhD. PhD’s still comprise less than 3% of our population. PhDs are scarce.
The other is the lonely road of no guaranteed pay check. Both choices are challenging. Both choices demand their sacrifice. Both choices see the vast majority fail. Don’t put faith in others to repatriate your wealth. Find where the wealth is going. Then choose to be there when it arrives.
About Christopher: Christopher Knight Lopez is a Professional Entrepreneur. Christopher has opened over 7 businesses in his 14-year career. Christopher’s purpose is to take advantage of various market-driven opportunities. Christopher is a certified Master Project Manager (MPM) and Accredited Financial Analyst (AFA). Christopher previously held his Series 65 securities license. Christopher also has his General Lines — Life, Accident, Health & HMO. Christopher has managed a combined 286mm USD in reported Assets Under Management & Assets Under Advisement. Christopher has work experience in 29 countries, raised over 50mm USD for various businesses, and grossed over 7.5mm in his personal career. Christopher worked in the highly technical industries of: biotechnology, finance, securities, manufacturing, real estate, and residential mortgages. Christopher is a United States Air Force Veteran. Christopher has a passion for family, competitive sports, fishing, martial arts and advocacy for entrepreneurs. Christopher provides self-help classes for up-and-coming entrepreneurs. Christopher’s passion to mentor comes from belief that entrepreneurs need guidance. The world is full of conflicting information about entrepreneur identity. See more at www.christopherklopez.com