So what is the deal, here? Math? Millionaires? huh?

Before we get into that, I'm sure you've heard someone grumbling about how the rich get richer and the poor get poorer at some point.

I'll bet the farm that the disgruntled soul you recall was NOT a millionaire, and was bitter about how hard he or she worked, never getting ahead and the frustration is understandable.

There are plenty of hard working people out there that will work hard their entire lives, or (gasp) until they are no longer able!

Ok, here's another cliche I'm sure you've heard. Work smart, not hard. I'm not going to say that wealthy people don't work hard. In fact, most do. However, if you look at how much they make for the effort they put in, you're going to see they make more than their less affluent counterparts.

Is it what they do?

Yes, in some cases it is. Programmers, CEOs, mechanics, dentists, business owners, and carpenters all perform very different tasks, and as a result have varying degrees of income. But is it not the only factor.

Is it how they do it?

Again, yes. Attitude, skill, talent, education, and charisma are just a few things that can differentiate one's success and earning potential. But is it not the only factor.

All things being equal, a wealthy person makes more money sitting still. They make money while they sleep.

You've surely heard that it takes money to make money. This tends to imply that if you don't have money, you have no hope of making money, and is often heard when people are lamenting about their lack of wealth, or jealousy of those who have it.

There are two ways to legitimately make money: You can earn it, or you can grow it through investment.

Earning it is active: it requires your your personal labor. If you don't work, you don't earn.

Growing it is passive: income and wealth produced from investments require no direct labor on your part. Whether you go to work or lay on the couch watching Oprah, the investment does what it does.

Now some, such as sports superstars, actors, and leaders of industry have stratospheric annual incomes, but they are few. How can an average person build wealth?

It takes time, but time will march on whether we position ourselves to be rich or not. You can set the stage to retire wealthy by putting money to work for you.

The simple one-word answer that is the foundation to everything that builds wealth and keeps wealth in the hands of the rich is... COMPOUNDING.

Read on to see how the effect of compounding makes millionaires...