Man climbing up a mountain symbolizing his ascent from poor to rich in virtue, character and wealth

The difference between the rich and the poor

The difference between being rich (in virtue, character or wealth) and being poor is largely a matter of habit, mindset and knowledge and has almost nothing to do with the circumstances one was born into.


In reading the book, The Compound Effect, one statement stood out to me: “A horse wins by a nose, but gets 10 times the prize money.”

Think about this.

The horse isn’t 10 times faster or 10 times stronger, it just won against the second place horse by a nose, and yet it’s awarded 10 times the prize. In 2009, Michael Phelps won the 200 m butterfly by being 0.88 seconds faster than his second place opponent. He did similar feats for all his competitions and now holds the record number of Olympic gold medals (23). Phelps wasn’t 23 times faster or 23 times stronger. He won by less than 1 second in many of his races when it mattered the most and he’s now immortalized.

Life awards exponentially

This is how all of life is! Life awards exponentially. I mean, if the 3rd place guy gets $10k, the 2nd will get $20k and the 1st will get $50k. Life holds dear those who pulled to the very front, despite how close anyone else got. It doesn’t matter how much distance you gained from the second place guy, only that you were ahead at the end. It doesn’t matter if you’ve been in last place all this time, only that you ended the race in first.

The rich have more good habits than others

In the same way, for those who have become rich ethically, morally and legally, they did so because they maintained more good habits than others around them. If they are a thousand times richer than their peers, it’s not because they had a thousand times more good habits, nor were they a thousand times smarter, faster, luckier or more good looking. It was because they pulled ahead by a nose, by less than a second, by 1 or 2 more better habits than everyone around them.

They studied more, they woke up earlier, they exercised, they did something very little, consistently over time that brought them just a bit further forward than anyone else and they won. For the winners, the investors thought their presentation was more polished and they won the prize money; the employer thought their tone was more confident and they won the job; the client thought their speech was more clear and they won the bid; the ladies thought their appearance was more sharp, their heart more gentle, their spirit more vibrant –




The poor have more bad habits than others

The poor on the other hand either are complacent or don’t participate in the game at all. They sit on the sidelines watching. They would rather smoke, drink, dream, eat pizza, buy lottery tickets, follow game stats, play video games, watch movies and hang out with their friends than spend even a moment developing a good habit that could contribute to their dreams. And as a result, life doesn’t even pay them any attention.

Listen, the rich maintain more good habits than the poor do. It’s not too much more, but just enough to get ahead. And by pulling ahead, by just a nose, by less than a second, they win 10 times the prize.


The rich mindset

The rich have a better mindset. Their mindset tells them that time is limited and valuable. It tells them:

  • That they themselves were meant to achieve something great.
  • To get back up.
  • That they’d be wise to use their talents to their advantage.
  • To keep trying.
  • That everything (EVERYTHING) is on them.

Again, they never say there’s not enough time, they make time; they never say why bother, they keep going forward. There is no one to blame, it’s all on them. This mindset drives into them the need to maintain good habits and good use of their time. They work on what gets them ahead. They’re not busy bodies, their productive. They don’t run in circles, they pull ahead. They get up after their falls just one time more than the person beside them and that’s why they win.

The poor mindset

The poor, however, have a poor mindset. They say there’s not enough time, why bother, I can’t do it, and it’s other people’s fault. They say the very thing that gets them off the hook. Then, when their lives end up bleak and empty, they say, “I was right, it was everyone else’s fault that I am where I am.”

The rich use a good mindset to pull ahead by just a nose, by less than a second, and for that, they win 10 times the prize.


The rich have more of the knowledge that matters than the poor. The rich in virtue know more about virtue than the poor in virtue, the rich in character know more about decision making than the poor in character and the rich in wealth know more about finances than the poor in wealth. Know more than the others around you and you pull ahead.

“Rich people have small TVs and big libraries, and poor people have small libraries and big TVs.”

Zig Ziglar

The rich care more about how to get ahead. That’s why the rich study and read more than the average person around them. The poor care more about entertainment. That’s why they run around in circles, hating their jobs, living for the weekend and wasting their evenings, instead of taking one step more towards their dream.

The Rich in Virtue vs. the Poor in Virtue

The rich in virtue know from whom to find faith, hope and love, they know how to build up courage, prudence, temperance and justice, they know how to spark magnanimity and industry and they know how to maintain humility and peace. The poor in virtue care for none of this which builds in them poor habits and poor mindsets.

The Rich in Character vs. the Poor in Character

The rich in character know that it’s all on them, that their decisions can make or break them, that they have a choice and that they can stop letting time slip away. The poor in character do not. They take tomorrow for granted.

There are no heroes, just heroic decisions.

Edward Snowden

The Rich in Wealth vs. the Poor in Wealth

The rich in wealth know how to use debt to buy assets that will make them more money than the debt. The poor use debt to buy entertainment or other liabilities that cost more than the debt provides. The rich invest their hard earned income and live off the cash flow from their investments. The poor live off their hard earned income.

In the end, the rich use knowledge to pull ahead by just a nose, by less than a second, and for that, they win 10 times the prize.


I knew people who:

  • Always dreamed of starting their own business, but only played games after work.
  • Dreaded their job, but only watched moves after every shift.
  • Wanted to drive nice cars, but was on YouTube watching others drive nice cars.
  • Hoped to get ripped, but only overate and never did a push up.
  • Planned to become a doctor, but only partied after class.
  • Wanted to be debt free, but then borrowed money for entertainment.

I also knew people who:

  • Wanted to start their own business, and become a millionaire in Silicon Valley.
  • Dreaded their job, and ended up doing everything he could to get into the company he dreamed of. He did so and climbed to the top.
  • Wanted to drive nice cars, and ended up buying one (a Tesla).
  • Hoped to get ripped, and did so through tremendous will power (even bringing his own meals to social outings).
  • Planned to become a doctor, and did so one through hard work and dedication.
  • Wanted to be debt free, and did so through sheer determination (he even cut up his credit cards).

What was the difference!? It was nothing but habits, mindsets and knowledge. The tragedy for all those that didn’t make it was that it was all free and within reach! If you have not already achieved great feats, that you can even read this article proves beyond any measure that you are capable of doing so.

But what about my circumstances?

What about them? The rich don’t care about circumstances, but the poor do. The rich own the situation and do whatever it takes to get in the lead, while the poor sit on the sidelines. Just get in the lead, separate yourself from the pack, get on top, by just a nose, by less than a second, and you’re there. Circumstances only flavor the story up. The actual outcome is up to you.

If a man:

  • With no leverage in his home country can liberate it from British rule (Mahatma Gandhi)
  • With no arms or legs can become a phenomenal public speaker (Nick Vujicic)
  • Living in subsidized housing can one day form Starbucks (Howard Schultz)
  • Whose family was fragmented due to the Communists can one day own Chelsea F.C. (Roman Abramovich)
  • Whose childhood was spent selling matches can one day own IKEA (Ingvar Kamprad)
  • Whose childhood was marred by tragedy can one day join the NFL (Michael Oher)
  • Who once lived in a shanty town in Argentina can one day become regarded as one of the world’s greatest football players and winner of the FIFA Player of the 20th Century award (Diego Maradona)

Then what stops you from achieving great feats? Nothing.

Gandhi could have just stayed in South Africa and India would be a different place today. Vujicic could have blamed life for his hurdles and never helped a single high school kid find greater meaning in their life. Schultz could have gone to work right after highschool and never started Starbucks. Abramovich could have continued selling rubber ducks from his apartment and never become a billionaire. Kamprad could have stopped selling matches because his clients (neighbours) were too far away and never start up IKEA. Oher could have said one wrong thing and never been given a chance by his school’s coach. Maradona could have never kicked a ball.

It’s all on you to become rich in virtue, character and wealth

The greatest story is not about one who was at the top and remained at the top, it has always been about the one who started from the bottom and broke all records, the “rags to riches”, the poor to the rich. If life has put you down, it’s only because it believed you could bear the greater cross and rise higher. It life is in “hard mode”, it’s because it believes you’re the better player. Through habit (free), mindset (free) and knowledge (free), you too can rise to the top. All it takes is a little bit more, just a nose, just a second, and you win. And life loves winners.

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