There are two metaphors that I’ve learned to comprehend: money and tree. Coincidentally, both are mentioned in the Holy Bible as matters to deal with extreme care. Let’s take a quick look at each:

Money

There’s a well known verse in the Bible: “You cannot be the slave of two masters! You will like one more than the other or be more loyal to one than the other. You cannot serve both God and money.” – Mathew 6:24. But there are plenty of references elsewhere to ‘money’ in the Bible, even in the parables by Jesus. In fact, there were numerous references that touch upon wealth and money alone. (I’ll be devoting some time to go through them in future editions of MoneyTree).

Tree

Did you know there were two trees in the Garden of Eden: The Tree of Life and the Tree of Knowledge (of good and evil). Adam and Eve were forbidden by God to eat from the Tree of Knowledge. Later on in Revelations (another book of the Bible) as well as other books, the Tree of Life is referred to giving eternal life… meaning Jesus Christ. So with this paradoxical nature of trees… one for knowledge and the other for life – we are given the freedom to choose.

But for those who are not spiritually inclined – there is the story of the real ‘money tree’ plant (technically called Pachira Aquatica), with its roots in Taiwan. It goes along the lines of an old farmer who worked so hard all his life and never really prospered. One day, he noticed a particular plant near his field – he hadn’t seen such a plant before, so he took it home to grow, he found that it was resilient, and hardly needed any water. He grew some more from its seeds and sold it to the local market where it was a big success because of the belief that it brought luck or good fortune. And so the myth was born, that if you had the money tree – you’d be lucky and have great fortune. Ironically, that farmer did become rich by selling thousands of money tree plants!

What does that spell out? MoneyTree – the freedom to chose what you do with your life and money. So here’s wishing you – as readers of the MoneyTree – lots of money and enjoyable life!

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Here’s a thought… European Union leaders are coming together to set up an emergency fund for Greece. Wait a second… you don’t set up an emergency fund when an emergency happens! You set up one way before it happens! Let’s take a page from this important history lesson in fiscal prudence and put our knowledge of crisis management to use!

“It’s all about crisis management.” – that’s what my old boss Jonty Cross at Merrill Lynch taught me at my first job. Unfortunately, it took me a long time to learn that lesson! But it’s never too late to learn.

Here’s what you’ll learn about emergency funds:

• What is an emergency fund?
• Why do you really need one?
• How much should you contribute (The Math)?
• How do you start one?
• What should you do if you’re in debt, do you start one?
• But I have a credit line / over draft / insurance!
• What does it feel like to have one?

From a pure financial point of view, you are rich when you have enough money to buy nearly everything you want today as well as in the future. However, you are wealthy if you have enough money to buy everything you want today as well as in the future, and still have a great deal left over. (Read that again!)

Here’s what you’ll learn:

• Wealth – it’s all relative, read the story below to see why!
• We’ll also take some lessons from the richest man who ever lived.

Generally, and this is what I agree with, the word ‘rich’ refers to money, whereas ‘wealth’ refers to something more than just money i.e. all the essentials in life – a total package of love, good health, good living, good job, great friends and loving family, spirituality, joy, peace of mind, plenty of time, combined with money and contentment with yourself and what you have. Being wealthy depends on what YOU believe is enough to make you happy, the amount is not the key.

For simplicity sake, we’ll assume wealth to refer to worldly wealth – not just being rich, but other areas of wealth, spiritual, emotional, physical – all inclusive in the pursuit of happiness! (Please do watch the film, The Pursuit of Happyness – it’s really worth it!)

It’s all relative.

Imagine this – you’re an educated person from an urban city, a well-paid professional. You’re on a trip to a rural place far off in Africa to set eyes on the un-spoilt surroundings and on your way, you meet a tribal leader, respected by all the locals and you talk with him in a newly-created sign language and help of a guide.

During the conversation, the leader shows interest to know more about you, your country and how wealthy you are – a matter of curiosity for him – a person from such a far off place to come and see him must have a lot of wealth!

You explain to him that your assets include – two homes, an excellent job, latest car, a professional camera that you are holding – showing it to him. The leader nod’s his head in acceptance and then frowns in disappointment and looks to the other elders sitting on the left and right, and starts a discussion with them. The guide looks at you, and tells you that the leader thinks you are extremely poor, because you have no cattle, not even one! Wealth is measured by everyone differently; each person has his/her own way of deciding how wealthy they are. Across countries and economies, what might be a luxury for some is not for others.

That’s wealth – it’s relative!

Someone once told me that the difference between the rich and the wealthy is that the rich need to impress and the wealthy need to be impressed. In a way it does seem to be true. I know of many friends who in order to keep up with the crowd or stand apart – try to impress us, they drive fancy cars, live in a fancy house, wear fancy clothes and eat at fancy restaurants – anything to show that they are well off.

The rich become flush with money in a number of ways. They may inherit it, earn it in a few short years as a professional sports player or entertainer, or invent a new technology that is worth millions of dollars, or simply earn it over many years as a professional or a business owner or even, because they are lucky, win a lottery. So with all this money, they buy assets, generally those that depreciate fast.

On the other hand, wealthy people buy assets that can be converted to other assets i.e. value-creating assets. Those assets can be tangible like your business, your second house and intangible, like your knowledge, skills or even peace of mind!

The difference between a wealthy person and someone who is simply rich is that a wealthy person has sustainable wealth. A wealthy person will always be wealthy, because he is planning for generations, whereas someone who is just rich will only be so for a short period of time until the money is exhausted.

So the question is, not how to become rich, but how to become wealthy?

Wealthy people know how to make money. Once you have the know-how, you can build sustainable wealth. Wealthy know that money comes and money goes – it’s not a big deal. But they also know how to generate wealth, when it’s gone.

The best example is written down in history, by the richest man who ever lived. He obtained his wealth through knowledge and valued knowledge more than wealth or money. That man was none other than King Solomon. He was extraordinarily wealthy, even by today’s standards. But he was also extremely wise, the wisest who ever lived.

When he first became king, when God asked of him what he wanted, he asked not for riches, but for knowledge and wisdom. And throughout Solomon’s writings (please read the Proverbs, there is one chapter for each day of the month), he lists wisdom and knowledge as the two most important gifts to ask of God. God gave wisdom and knowledge to help create Solomon’s great wealth.

You can have a billion or even a trillion dollars today, but what assurance do you have that you live a life free of sickness tomorrow – or God forbid, even be around on this earth!?

Let’s admit it… money does matter. But wisdom and knowledge can create far greater wealth for anyone who desires it. Are you ready to become wealthy?