Wealth can mean a number of things. That ever-elusive commodity of happiness, good health, a number of family and friends – any of these things can represent wealth depending on who you ask. Most people, however, will claim that wealth is a measure of how much money they have.

The Value of Currency Tender - Money

There is another way to think about wealth, and that is in terms of value. You may have heard the claim that the only value to any item is how much someone is willing to pay for it. This is inherently true. If you think of money in terms of a commodity, you can easily see how. Cash is merely pieces of printed paper. What you receive in return for using that cash defines is value. This value changes from day to day, particularly if you trade in global markets.

Two different people can own the same amount of money. One can be considered wealthy while the other is not. The difference is what each does with their money and how many other assets they have. It is also part of a person’s mindset. If you think of money as a commodity with varying value than you will make investments that negate any cash losses. If you simply look at money as a means to provide yourself with whatever it is you want – whether it is a new car, a big house, or the latest electronic gadget – then you will never become wealthy.

Commodities - Assets - cash

As previously stated, cash is a commodity; a transferable one. So, also, is gold.

American dollars have lost value in the past year. Gold, however, has gained value and it is continuing to do so.

Although gold does not provide you with a meal, or a roof over your head, it can be traded for something equal its value. When the dollar loses value and gold gains, you can see how worthwhile it is to ensure that at least some of your wealth is contained in more than cash accounts.

There are many other ways to think about wealth and many other ways to create it. Part of the “secret” to becoming rich is your mindset and how you think about accumulating assets that will retain value in your portfolio even in a depressed market.