Money Who Has the Tied Cow

Money Who Has the Tied Cow

“How much do you earn each month? 80 thousand pesos? That one that has the cow tied! ”

This exclamation, which we can hear from a friend in any meeting, contains in itself a series of simplistic assumptions that lead directly to a fallacy: the idea that income is God and that the rest of the variables linked to money do not influence the financial health of a person.

Life is much more than income

Perfect. Fulano earns 80 thousand pesos per month, but. What is your true financial situation? That isolated data tells me nothing about it. Therefore, I do not know if he has the cow tied or actually runs a bull. To be able to speak with ownership of your economy, I must contemplate 3 Fundamental items:

  1. The nature of income: It is not the same to receive 80 thousand pesos per month net for a job in a dependency relationship (unidirectional income) than to earn, for example, 35 thousand pesos for an independent activity as a monotributista and 1,000 dollars per month for the interest generated from financial investments. In the first case, income can be classified as risky because of the possibility of losing employment in a crisis like the current one. In the second, the diversification of investments allows mitigating the impact of a recessive scenario and even taking advantage of the context to maximize perceived interest.
  2. The level of expenses: The 80 thousand pesos per month are not more than nominal data. They do not indicate the real purchasing power of a person. If you rent an apartment in a residential neighborhood and send your children to a private school, you may have little or nothing left to save. Those 80 thousand pesos will have a greater value in your life if your level of fixed and variable expenses (among which are the dangerous ant expenses ) are controlled. Otherwise, what for a friend of ours may seem like a lot, for so and so it is insufficient. Consequently, the optimization of expenses through a previous analysis like the one we studied earlier It is what can make those 80 thousand pesos worth more in real terms because they would enable the appearance of a surplus that will easily be transformed into investment and generation of passive income.
  3. The patrimonial situation: We arrive at the key point that will give us the definitive answer about the value of those 80 thousand pesos. If the person is paying a debt owed with a credit card or a personal loan or a mortgage loan, then we will be talking about interests that erode the “use power” of your income and reduce your purchasing power. To make matters worse, in an inflationary context with very high rates, it is likely that an increasingly important portion of your income will end up being lost in interest payments without even reducing the size of the debt.

We refer to the generation of a monthly surplus in the relationship between income and expenses that becomes savings and can be used to purchase financial assets that generate more and more income. In that case, the 80 thousand pesos per month have a higher real value because they allow, in their projection to the future, an increasing patrimony.


Income is an important component of those who have the cow tied, but not necessarily the most important. The same level of income will have greater or lesser real value depending on its nature, on the monthly expenses of the person who receives it, on its patrimonial situation and on its capacity to generate new income with the surpluses generated.

Investing all our energy in raising income can make us fall into the trap of “the rat race”, in the words of Robert Kiyosaki, where the process resembles that of the hamster that runs and always runs within the same rotating cage with shape wheel


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