| Most people with a seven-figure net worth (or more) worked, saved, invested and compounded their money over a period of years - and often decades. Some Americans didn't - or couldn't - work. Some didn't - or couldn't - live within their means and save. Some saved but never invested. (And so earned low returns.) Some invested but not wisely. Some invested wisely but couldn't avoid the need - or, more often, the temptation - to spend their money rather than letting it compound. The American economic system is rigged. It favors education, industry, frugality and risk-taking - qualities that have made the United States the richest nation in the world. (More on this in my upcoming column in honor of Independence Day.) In short, the principles of wealth creation are well known. However, they are not taught in most public schools. As a result, most Americans don't understand them - and haven't acted on them. The causes of poverty in this country are also well known. Everything from the economic status of the home you are born into to your IQ to the quality of the schools you attend plays a part. But studies consistently show that you are highly unlikely to live below the poverty line in this country if you... - Don't drop out of high school
- Work a job (any job)
- And avoid having children before age 25 without being married.
Yes, some people are dealt a bad hand. They endure bad health, terrible accidents or tragic circumstances. But polls show that 42% of Americans have total savings of less than $1,000. It's tough to ascribe that to bad luck alone. Clearly, not enough folks are working, saving, investing and compounding their money. The ones who do, however, reap the rewards. And this is especially so today with people living longer. From 1940 to 2019, Americans' life expectancy rose by almost 16 years, while the share of the U.S. population 65 and older increased from 9.8% to 16.7%. The elderly have worked more years than the young and middle-aged. And their money has had longer to compound. Wealth grows with time. I've experienced this myself. As a young man in my 20s, I had a net worth of approximately zero. But after four decades of working, saving, investing and compounding, I'm one of those detestable one-percenters that some are always banging on about. The old have more wealth than the young because the young haven't had nearly as long to work, save and invest. It's a reminder that unequal doesn't necessarily mean unfair. A final important note... Economic freedom and economic equality are always at war with each other. Look around the world and you'll find that the countries where incomes and household net worths are the most equal - places like Cuba, North Korea and Venezuela - are exactly where the citizens are the poorest... and the least free. The single biggest contributor to wealth inequality in this country is not our economic policies. (Although those could certainly be more conducive to wealth creation.) It's that we are living longer. Yet Bernie Sanders finds this "morally obscene." That's partly because he's ignorant. And partly because the truth doesn't give him an opportunity to grandstand... or win him any votes. Good investing, Alex | 
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