The "seven middle-class bankruptcy triggers" are trending all over the internet: How hard is it for the contemporary middle class to preserve their wealth?

Some time ago, "The 7 Middle-Class Bankruptcy Triggers" went viral all over the internet.

You must have heard of the three-piece set and five-piece set that lead to middle class bankruptcy, and now it has been upgraded to the seven-piece set.

What exactly are these seven items?

They are respectively: high mortgage, full-time housewife, blind over-investment in children's education, blind entrepreneurship, blind investment, neglect of health, and keeping up with the Joneses in consumption.

How do these seven items cause the middle class to go bankrupt?

Isn't buying a house a normal thing? Isn't it normal to want your child to attend a good school? Isn't it also normal to make some investments and manage your finances?

The problem is that each of these items alone is not that unreasonable. But when you put all seven things together, they form a sophisticated machine that pushes people back into poverty.

Let's do the math:

You earn 30,000 yuan a month, with a 15,000-yuan mortgage, 3,000-yuan car loan, 4,000-yuan tuition for children's tutoring classes, and 8,000 yuan for daily family expenses. You have less than 1,000 yuan left every month.

What does that mean?

In other words, your actual disposable income is no different from that of a person who earns 5,000 yuan a month.

Moreover, your sense of anxiety is much heavier than those who earn less than half of your income.

You dare not lose your job, dare not get sick, and even dare not stop to catch your breath. Because you still have to pay the mortgage, the car loan, your children's tuition, and take care of your parents' retirement.

Once you stop, your cash flow will break instantly. You live every day like walking a tightrope, moving forward with extreme caution.

In fact, the biggest illusion that supports the middle class in all this is the belief that their salary will keep rising and they will never lose their jobs.

But the reality is that the economy will not always go up, and the industry will not always be prosperous.

Especially in the current environment. The background of the era has changed, the underlying assumptions have changed, and the rules of the game have naturally changed as well.

Over the past two decades, growth has pushed everyone forward like a tide, and those who rushed harder earned more.

Now, the best approach is: stay steady and don't take unnecessary risks, keep what you already have.

Just as scholar Ma Jiangbo once said: The middle class is switching from an "offensive life" to a "defensive life".

All our lives we have been thinking about how to make money, believing that earning more means being capable, but few people realize that preserving wealth is actually a greatly underrated skill.

Nowadays, the matter of preserving wealth requires more and more people to attach great importance to it from the bottom of their hearts.

01

Why Is It So Hard for the Contemporary Middle Class

to Preserve Their Wealth?

In the past few days, the trending searches about Zou Shiming and his wife made me feel quite emotional.

After seven years of entrepreneurship, their losses exceeded 200 million yuan.

The couple opened boxing gyms, made layouts in the catering, e-sports and milk tea industries, and even followed the trend to invest in high-risk wealth management products, but ended up failing across all fronts.

They went from "boxing champion" to "debt champion" completely.

Many people think that they were already so rich, why couldn't they just live a good life and enjoy themselves with the money, and had to start a business?

That's because they thought that since they could make a fortune once, they could make it a second time.

They thought that worrying about losing the money in their hands all day long was too unimpressive, too uncourageous, and too incompetent.

This is the most fatal part of human nature, and it is also the starting point for the vast majority of people to lose all their wealth.

But Rockefeller said similar words many times: It takes courage to create wealth, but it takes wisdom to preserve wealth.

All things that can make you lose all your wealth, no matter how high the return is, don't touch them.

In addition, the main reason why the contemporary middle class finds it hard to preserve wealth is not in their wallets, but in their minds.

That is, they clearly cannot afford the consumption anymore, but their desires remain.

Their minds are still stuck in the stage where they think they are part of the middle class. They need nice cars, send their children to good schools, and travel abroad every year. They feel that if any of these things are missing, their life will be unsatisfactory.

As a result, they fall into a huge gap: their desires are high up in the clouds, but their abilities are already on the ground, and they can never reach no matter how hard they try!

02

How Can Ordinary Middle Class People

Stably Preserve Their Wealth?

1. Erase the term "middle class" from your dictionary.

Middle class is not an income standard, it is a consumption standard.

It tells you what to buy, what to use, and what kind of life to live to be qualified as a member of the middle class.

Once you accept this definition, you will be kidnapped by it.

But you have to know that you are not a label of middle class, you are an individual. You have a certain level of income, your own expenses, and your own life pace. You don't need to live up to any standard version.

2. Take the initiative to downgrade your consumption.

The collapse of consumption for many middle class people always starts from unrestrained and involute pursuit of exquisite life.

The most sober perception of wealth for adults is that never act against the economic cycle.

You used to buy branded products, but now it's okay to use cheaper alternatives.

You used to drink freshly ground coffee, but now instant coffee is fine too.

You used to buy a batch of new clothes every time the season changed, but now you can take out your old clothes, wash them and wear them again.

However, you need to note that when you downgrade your consumption, active downgrade and passive downgrade are completely different things.

Passive downgrade means you are cornered by life and have to give up, that feeling is called failure;

While active downgrade means you choose to make your life simpler, that feeling is called freedom.

3. Invest cautiously and never gamble.

Most real millionaires preserve their wealth through long-term savings, rigorous budgeting and adherence to low-risk assets.

Those who are eager to change their fate through big bets often end up in disastrous defeat.

A "big gamble" scene was staged in the South Korean stock market:

A large number of retail investors used leverage to heavily hold the 2x leveraged ETF of SK Hynix, betting that the semiconductor market would keep rising.

Some people put all their wedding house purchase funds into it, some even withdrew their pensions, thinking that they would soon achieve financial freedom.

Unfortunately, they only saw the good life after winning, but never thought about the consequences after losing.

In the end, SK Hynix's stock price plummeted from a high level, and the principal in many retail investors' accounts went straight to zero.

This makes many people understand a truth: You can never earn all the money in the world, but you can lose all of it.

Therefore, before we do things, we should only do things we really understand, only invest in projects with clear and calculable accounts, and never rely on gambling.

Put your money in fields with high certainty that you have deep understanding of, so that your wealth can roll more and more stably and grow bigger like a snowball in the value system you build.

Finally:

In the past, the seven sets of middle-class bankruptcy triggers were things that everyone tried their best to pursue.

However, the map of the past may no longer be able to guide the road today.

Now, no matter it is the mismatch of cognition or the change of the era, everyone should be sober in recent years ——

We don't need to prove that we are part of the middle class anymore. Being able to keep the money in our pockets is the real skill of a person.

This article is from the WeChat official account "Xiaofang Talks About Workplace" (ID: XF-SZC), written by Wang Xiaofang's team, and published by 36Kr with authorization.