Tom explaining most popular financial words ##animation #Finance #uk

This is rich. This is wealthy. What's the difference? Rich is a big paycheck. Wealthy is money that works while you sleep. Rich is income. Wealth is freedom. This is saving. This is investing. What's the difference? Saving is putting money aside and keeping it safe. Investing is putting money to work so it grows. Saving protects your money. Investing multiplies it. This is inflation. This is deflation. What's the difference? Inflation means prices go up and your money buys less. Deflation means prices go down and your money buys more. Sounds like deflation is better, right? It's not. It means the economy is in trouble. This is an asset. This is a liability. What's the difference? An asset puts money in your pocket. A liability takes money out. Your rental property, asset. Your car payment, liability. This is income. This is net worth. What's the difference? Income is how much you earn every month. Net worth is everything you own, minus everything you owe. You can have a huge income and a negative net worth. That's called being broke with a salary. This is credit. This is debit. What's the difference? Credit means you're spending borrowed money. The bank's money. Debit means you're spending your own money. You use these words every day. Now you actually know what they mean.