INCOME VS. WEALTH

Income is the money that people receive from work, government benefits, or investments. Wealth, or net worth, refers to savings, real estate, retirement funds, stocks, bonds, and trust funds. The position of large amounts of wealth, not merely income, is what distinguishes rich people from the rest of the population.

Example:  A wealthy person may have a net worth in the millions or billions of dollars, while the average American is in debt (or has a negative net worth). Income based on a large amount of wealth (investments) is generally more stable than income based on work, since a person may lose his or her job and be suddenly without any income.