One of the biggest misconceptions people have is that someone who earns a lot of money is sure to have a lot of money. But having money is not just a matter of how much you earn. It's also about how much you live on. Who do you think is better off financially: a person who makes $30,000 and spends $25,000 or someone who makes $250,000 and spends $300,000?

The Root of the Problem

A recent study found that nearly one in five workers who earn $100,000 say they often or always live paycheck to paycheck. That's 20% of the top earners in the country! These are people who should have a high net worth, but they can't control their spending and eventually end up broke.

Some people blame high housing costs, college education, high car payments, or a million other things. Those may be the symptoms, but they are not the problems. The problem is the person. Spending all the money you make and using debt to make up the difference will keep you broke your entire life, whether you make $40,000 a year or $400,000. Getting out of debt and having no payments is so crucial to serious wealth-building.

No One is Exempt

Even at a high income level, you need an emergency fund. Sadly, another survey found that 18% of people couldn't continue their lifestyle for even 1 month if they lost their income. They have no money saved up! These are disasters waiting for a place to happen. The average family in America makes about $40,000 a year. If a family making a six-figure salary were to live at that income level for just a couple of years and make some sacrifices, they could be completely debt free with a huge income. Who wouldn't want that?

The good news is Dave's Baby Steps work at any income level. If you follow them in order, pretty soon you'll be bringing money home in a wheelbarrow. The plan works every time!

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