We often link wealth, or riches with money, thinking it’s the only important thing. But there are different types of wealth we probably need for a more satisfying life, such as social, physical, and emotional.
In today’s world, we focus a lot on financial wealth, striving for more money and social status, sometimes even overlooking our health and relationships.
Money, or financial wealth, gets a ton of attention. People can get really into it, giving up other things in life for more money. But having a lot of money doesn’t guarantee happiness. Just chasing after one type of wealth, like financial wealth, might feel good now but could lead to problems and regrets later.
Take the classic story of a 50-60-year-old man who dedicates his life to climbing the corporate ladder and being rich. In his pursuit of wealth and career success, he often works long hours, missing out on crucial moments in his son’s life. The son grows up, and while the man has financial wealth, he realizes he’s missed valuable time with his family. Despite the impressive bank balance, he may end up feeling poor in terms of the meaningful connections and experiences he sacrificed.
Another example could be someone so consumed by financial goals that they neglect their health. Constantly working to amass wealth without considering physical well-being might lead to health issues later on. In this scenario, despite having financial wealth, the person may find themselves struggling with poor health, impacting their overall happiness.
These examples highlight that while financial wealth is important, focusing solely on it can lead to missed opportunities and a sense of poverty in other crucial aspects of life.
Sometimes, I can be one of those people who take things easily or for granted. Even though I’m not a millionaire, I realize I have many other of type wealth such as my health and my family.
This reminder makes me thankful. I’m sharing this post not just for me but to remind you as well. It’s a nudge to help you experience more of these different types of wealth and appreciate what you have.
To live well and be happy, we probably will need more than just money. Rather than focusing on it alone, let’s amass all the different types of riches to fully experience life!
Here are 7 different types of wealth that you can consider for a better quality of life!
Financial wealth
The first and obvious is financial wealth. When people hear wealth, they often associate it with money.
Many want to work optional, simply to spend more time with their family/kids or maybe getting sick of the corporate rules, like me. Being financially independent allows you to be able to pursue activities that truly matter to you, without worrying about money. If you can do that now, congrats!
It’s obvious why people are chasing financial wealth. For me, it’s because I’m a little tired of dealing with corporate bullshit and managers. Getting laid off so abruptly wasn’t fun at all.
Different people have varying comfort levels. For some, $500,000 may be sufficient for their desired lifestyle, while others might aim for $5 million. It ultimately depends on how you envision your life and the level of comfort and happiness you seek.
Just like achieving other goals, accumulating financial wealth takes a lot of time and patience. The principle behind it is simple:
- Increasing income
- Reducing expenses
- Investing the rest
Types of financial wealth
There are two main types of financial wealth: liquid and illiquid assets.
- Liquid assets: Things that can be quickly turned into cash without losing much value, like money in the bank, stocks, or bonds.
- Illiquid assets: Stuff that can’t be easily turned into cash without losing value, like real estate or fancy art.
Stages/levels of financial independence
- Survival mode (living paycheck to paycheck)
- You make enough to cover bills but living paycheck to paycheck.
- Negative net worth, possibly due to liabilities like student loans.
- Steady progress and you start improving your net worth
- You save more, but your net worth is still negative.
- You can sustain for a few months if you lose your job
- Debts like consumer, student loans, and credit cards are paid off.
- Growth Phase/wealth accumulation
- Accumulating wealth and investments.
- Healthy cash flow and 3-6 months of emergency funds.
- You start building FU money.
- Financial freedom
- You can quit your job and live off your investments without ever working again
- Financial abundance
- You don’t have to work anymore, and you can live a luxurious life without worrying about money. It might even be enough to support the next generation.
Check out these challenges to improve your financial wealth:
Create your debt-free and money vision board
Time wealth
In a world filled with distractions and constant demands on our attention, mastering the art of time management is crucial. It requires prioritization – the ability to discern what truly matters and allocate our time accordingly. Just as skilled investor diversifies their portfolio to minimize risk and maximize returns, we must diversify our use of time to ensure balance in various areas of life.
Two years ago, I found myself earning more money than ever before, a significant achievement coming from a developing country. However, the stress was overwhelming. Late nights at work left me drained, making it difficult to indulge in my hobbies or exercise. That’s when the feeling of being time-poor crept in.
Unfortunately, I faced a layoff, which, strangely enough, turned out to be a blessing. I landed another job that pays less but demands less too. Now, I have the time to dedicate to my blog, cherish moments with my family, and prioritize what truly matters to me.
It’s often difficult to have both time and financial wealth simultaneously. Those with substantial money are often occupied with work or busy growing their businesses to accrue more.
Despite having the means, they’ve become trapped and cannot be free because people usually want more and more, whether it’s money, material possessions, or social recognition.
Time is a finite resource, and how you spend it determines a unique form of wealth. Allocating time to pursue your passions, spend with loved ones, and engage in joyful activities contributes to time wealth. It’s about making choices that align with your values and priorities.
Creating extra time isn’t possible, but you can prioritize to make room for what matters most. Here are a couple of things you could try:
- Plan your day and prioritize. List the most important tasks and aim to finish them in the morning before heading to work. Adjust your bedtime a bit earlier to make this possible.
- Embrace the mindset that even dedicating 10 minutes to an activity is better than none. I apply this to my walking routine – even a brief 10-minute walk still contributes to building my habit.
- Learn to manage your emotions and reduce procrastination habits.
- Delegate your tasks. Share it with others if possible.
- Stop pleasing others too much and set boundaries if that’s your habit.
- Understand that time is limited. Make sure to allocate time for what matters to you, be it family, friends, or your hobbies.
Being told life is short is good for making priorities, but it can also stress us out. I’m saying this to tell everyone we have time, so let’s chill out and enjoy things more.
The way we spend our time defines who we are – Jonathan Estrin
Social/Relationship Wealth – Family & Friends
Strong and meaningful connections with family, friends, and a supportive community are priceless.
Nurturing relationships brings emotional wealth, creating a support system that adds immeasurable value to our lifes. Sharing experiences, joys, and challenges with others enriches our journey.
You don’t need many friends to beat loneliness; having 3 close ones is plenty. It’s not about the numbers, but the quality of connections.
Since 1938, Harvard researchers studied what makes us happy. It’s not career, money, or health habits – the consistent finding over 85 years is that positive relationships keep us happier, healthier, and living longer.
Researchers even put a value on a close friend – it’s like getting a happiness boost as if you earned an extra $150k.
Nurturing relationships requires time and effort. Communicate openly, actively listen, and prioritize quality time with loved ones.
Here are a couple of tips to nurture your relationships:
- Be part of a community. Find activities you enjoy doing on Facebook group or meetup.com to meet new people.
- Make time for your friends and family.
- Reach out to friends or family with a simple call or text to show you’re thinking of them.
- Schedule a casual meet-up, whether it’s grabbing coffee or having a meal together.
- Tell someone you appreciate them – a little gratitude goes a long way.
- Listen actively – when in conversation, give your full attention and show genuine interest in what they’re saying.
Emotional wealth
Emotional well-being is a valuable form of wealth often overlooked.
Similar to physical health, people can also face mental struggles. Sometimes, it’s seen as a taboo topic in certain cultures or societies.
Luckily, in Western culture, there’s a growing awareness of how crucial mental health is.
As I write this, I must admit my mental state isn’t the best. Living in the US can feel lonely, but I’m trying my best to stay active and nurture relationships.
Taking care of our mental health isn’t just about us; it affects those close to us – our spouse, kids, and parents. So, by prioritizing our mental well-being, we’re also looking out for the people we care about.
Mental health depends on various things like our genes, experiences in our early life, how we handle stress, and our overall physical health. Where we live, the people around us, and how we cope with challenges all play a part in shaping our mental well-being.
Taking care of our mental health is also important because it’s like the base for our overall well-being. When our mental health is good, it makes life better – we can handle stress, be creative, and enjoy our daily activities more.
Here are a couple of things you can do to boost your mental well-being:
- Spend time with friends and family, and talk about your feelings. Social connections can boost your mood!
- Move your body! Exercise helps release feel-good chemicals and keeps your mind healthy.
- Make sure to rest. Quality sleep helps your brain recharge and keeps you ready for the day.
- Feed your body nutritious food. A healthy diet supports both physical and mental well-being.
- Give yourself short breaks during the day. It helps your mind relax and recharge.
- Try simple activities like deep breathing or focusing on the present moment. It can calm your mind.
- Break big tasks into smaller ones. Achieving small goals boosts confidence and reduces stress.
- Take breaks from screens. Too much screen time can impact your mood and sleep.
Physical Wealth
“A healthy person has a thousand wishes, a sick person just one.” – Tony Robbins
I got COVID around New Year’s, and all I wanted was to get better.
I know it’s easy to take things for granted sometimes, but if you read this and you are healthy you have one form of wealth that many people feel jealous of.
Unfortunately, neglecting your health today will only bring more problems down the road. Yesterday is the best time but today is the second best time to start taking care of yourself. Just like getting wet can lead to discomfort, skipping exercise and not paying attention to your diet can leave your well-being feeling drenched.
Physical wealth might even be more valuable than time or financial wealth, because without it you can’t enjoy your time or maybe your money.
According to healthline, here are a couple things you can do to live longer:
- Getting enough sleep
- Exercise.
- Nurture your social circle
- Eat when you feel hungry (not bored) and avoid overeating
- Consume balanced diet
We often hear to work until we’re old, then retire and travel. But when you’re old, you might not be as physically fit to enjoy travel like when you’re younger. If that’s on your mind, do it while you can!
Skills/Talents Wealth
Skills and talents are things you’re good at or enjoy doing. Skills are things you learn, like playing an instrument or cooking. Talents are things you’re naturally good at, like drawing or making people laugh. Having skills/talents can put you ahead of many people, possibly early in life.
Having skills and talents is a kind of wealth because they can bring joy and make life interesting. They’re like tools you carry with you – they can help you in many situations.
People might pay you for your skills, and your talents can bring happiness to you and those around you. Just like having money is a form of wealth, having skills and talents is a special kind of wealth that makes your life richer and more enjoyable.
Another example is communication skills. Being good at talking and listening is helpful in jobs, relationships, and making friends. People who can communicate well and are trustworthy often excel in management.
But remember, you don’t have to be born with certain skills – you can learn and get better at them. Whether it’s talking to people, solving problems, or being creative, anyone can improve by practicing and being open to learning. It’s like getting better at a game – the more you play, the more you learn, and the stronger you become.
Ways to nurture your skills and talents:
- Practice regularly. Just like playing a sport or a musical instrument, practice is key. The more you practice a skill, the better you become.
- Seek feedback. Ask mentors and others for feedback on how you’re doing. It helps you understand where you can improve and what you’re doing well.
- Learn from others
- Set small goals. Break down the skill into smaller, achievable goals. This makes it less overwhelming and helps you track your progress.
- Be patient. Learning and improving take time. Don’t get discouraged if you don’t see instant results. Be patient with yourself and keep practicing.
- Challenge yourself. Don’t be afraid to push your limits. Challenge yourself to take on tasks that slightly stretch your abilities. This helps you grow and become more skilled over time.
- Pay attention to your strengths and interests.
Memories Wealth: Adventures, Experiences, and a Legacy
Adventure or experience wealth is like a collection of exciting memories from trying new things.
It’s about the fun and lessons you get from different activities and places, like traveling or exploring new foods.
Last year, my family and I went on a trip to Portugal and some other European countries. It cost a bit, but I’m happy I did it. We made great memories together. I can look back, cherish them, and look at our pictures when I’m older.
Having adventure or experience wealth is like having special treasures that make life more interesting. These memories stay with you, making your life richer and more colorful. Sometimes it’s not about having lots of things; it’s about the cool stories and experiences that make your life unique and valuable.
You can also think of it as a legacy of memories. Whether it’s with your friends, or your children and grandchildren. These memories are what they’ll have after you pass away.
Accumulating experiences and memories doesn’t always have to be expensive or time-consuming. Sometimes, you can create long-lasting memories with simple moments.
Here are some simple tips to have more adventures and create a legacy of memories.
- Try new things regularly, whether it’s yourself or with your family.
- Explore your local area. You don’t always need to travel far for new experiences. Explore your local area, visit new spots, and discover hidden gems. Adventures can be found just around the corner.
- Document your experiences. Keep a journal, take photos, or create a scrapbook of your adventures. Documenting your experiences helps you relive and appreciate them over time.
- Plan small gateways. You don’t need a big vacation for an adventure. Plan small getaways or day trips to nearby places. It adds variety to your routine and contributes to your experience wealth.
Wrapping up
In life, we often think wealth means only money, but there are different types of wealth that make life good. Money is one, but there’s also time – making sure to spend it on important things. Being with family and friends is another kind of wealth, and it makes us happy.
Feeling good inside (emotional wealth) is like a special kind of richness too. Our health (physical wealth) is super important, maybe even more than money. Skills and talents are like having cool tools that make life interesting.
And don’t forget about memories – like the fun things you do and the stories you tell. All these types of wealth make life awesome, not just money!
Vi, a software engineer with a keen interest in personal finance, had planned to retire once she reached her lean FI/RE (Financial Independence/Retire Early) goal. However, after achieving the goal, she took few months of a mini-retirement filled with travel and adventure and decided to continue her career.
For the past five years, Vi has been using Personal Capital (Empower), a free financial tool. Her favorite features include the dashboard for net worth, allocation, and planning, which help track her FI/RE goal and keep those investment fees in check.