We all got wealth in different amounts some might say it isn’t everything. But never the less it is essential to understand what the concept is so you understand that you have more wealth than you might think.
To understand wealth, we have made this simple explanation taking offset in one man. This man has nothing except the clothes he is wearing and living on an island so he need to catch fish to eat and this is what he does.
The first day he catches a fish with his hands, the next day he also catches one fish, but in the third day, he decides to keep on until he has two fish because then he can take the next day to relax. But instead of resting he makes a fishing spear so he can catch more fish. Now he goes down and catches 5 fish. Now he uses the next 4 days on creating an axe and a canoe so he can trade with the next island. Before he sets out to trade he want some fish to trade with this makes him fish for 5 days and with 5 fish a day and consumption of one he sets of in the morning of the 6th day with 20 fish. Before he sets off, we make a status of his wealth
- 20 fish (they are desirable as a trade commodity)
- A spear (are desirable as a means to gain fish)
- An axe (it is desirable as a tool to gather resources)
- A canoe (which is desired for trade)
So this is a simple explanation of wealth, and if you want more articles that explain economy, cryptocurrency and blockchain technology then click the little red bell in the bottom right corner and let us notify you when new articles come online
When your wealth increases
If you start with a low income, you will desire cheap items this could be a new thermos, and when you buy it, then it will be part of your wealth because it is an item you desire. But as your incomes grow you will desire more and more expensive things so if you reach a middle income the thermos is no longer wanted since you have money to buy fresh coffee on the go, therefore it will no longer ad to your wealth unless you can sell it because then it is desired by others. So if you want to calculate your economic wealth, then you should remember if you can stick a price tag on it you can add it to your wealth. Just remember to be realistic about what you can get for used items it can sometimes be beneficial to get an item assets by a professional to determine the value, so you get a clear picture of its value.
Can I count my cryptocurrencies in my wealth?
Yes, you can, and it is simple just calculate the value of what exchange rate you can get.
Personally, I use coinbase for my calculation, if it is not on coinbase, I don’t calculate it as part of my wealth. But you might find it useful to calculate all your altcoins as part of your wealth.