海角大神

Why do some people become wealthy and others聽stay broke? In many cases, it comes down to choices.

To see the impact choices can have on your life, let鈥檚 look at three fictional friends: Arthur, Brian and Charlie. They grew up together in families with聽the same socioeconomic status. Now 35 years old and married, they all have average health, incomes and debt 鈥� but their financial outcomes won鈥檛 be the same.

Arthur

Arthur is happy with the status quo and doesn鈥檛 think anything needs to change in his life. He simply does what he鈥檚 always done.

He contributes聽3% to his 401(k),聽enough to get his employer match. He knows he聽should聽save more, but figures he鈥檒l do it when he makes more money.

He has student loan debt, a car payment, a mortgage and a credit card balance of about $5,000. He鈥檚 able to make these payments each month, so he鈥檚 not worried about the debt. He figures that if the bank is willing to loan him money, he鈥檚 in good shape financially.

Brian

Life is good in Brian鈥檚 world. Money is tight, but it鈥檚 all for the good of the family.

He just purchased a brand new TV, which his whole family loves. They watch it聽each morning and evening聽as they relax in their聽comfy new recliners in their brand new house. (Brian believed聽they needed more space for their growing family.) They also have a new car, new appliances and nice vacations each year.

His family has the usual debt load: student loans; a car payment; a new, bigger mortgage payment; and a credit card. He puts vacation expenses on his聽credit card, but always thinks he鈥檒l pay them off in a month or two. He believes that it鈥檚 fiscally smart to charge purchases in order聽to earn as many 鈥渇ree miles鈥� as possible聽鈥� and that聽carrying credit card debt聽improves聽his credit score.

Brian recently changed jobs. His 401(k) wasn鈥檛 doing very well, so he chose聽not to contribute anything at his new job, even though his employer matches 3%. Instead, he cashed out his 401(k) to buy his new TV and furniture.

Charlie

Like Arthur and Brian, Charlie and his family have student loans, a car payment, a mortgage and a credit card. But it bothers Charlie. He feels like most of their income walks out the door in the form of debt payments, and he dreams of how his family will have more freedom聽without聽debt. To that end, he makes聽small changes to strengthen their聽financial foundation.

Charlie reads about getting聽out of debt. He develops a plan to pay off all nonmortgage debt within three years and be聽100% debt-free, including the mortgage, within eight years. He聽and his wife also聽trim their budget. For example, they stop going out to dinner聽once a week, and Charlie starts bringing his lunch to work each day instead of buying it.

He聽also puts in one or two hours each weeknight, after the kids are in bed, making聽some extra money.聽With the聽additional聽income, Charlie opens a Roth IRA and automatically contributes just over $200 every other week so he can聽max out it each year. This is on top of the 3% of his income that he saves in his 401(k), which his employer matches.

He chooses to fill his mind with positive and inspiring information and new ideas. He starts reading more and listening to instructional books and podcasts during his commute.

Charlie鈥檚 four simple choices 鈥斅爌aying off debt, creating more income, contributing to a Roth IRA, and nurturing a positive outlook 鈥� may not be seem all that impressive, but they will dramatically affect the well-being of his family in the long run.

Six months later

Six months pass and the three聽friends haven鈥檛 made much progress.

Arthur continues to plug along with nothing changing.

Brian聽still loves his new TV and is planning the next family vacation in Hawaii 鈥� they deserve a treat!聽He hasn鈥檛聽paid off the last vacation because his family wanted new granite countertops for their kitchen. And he still hasn鈥檛 signed up for his 401(k).

Charlie is keeping up with his lifestyle changes.

If you tallied up the three friends鈥� net worths and investment accounts, they鈥檇 look about the same as before. No one is significantly closer to financial freedom.

Three years later

After three years, the results of Arthur鈥檚, Brian鈥檚 and Charlie鈥檚 choices聽really start to show.

Arthur is still average. He鈥檚 in no hurry to pay off his debt, but has accumulated about $10,000 in his 401(k). His net worth is around $0, where it鈥檚 been for years.

Brian聽looks聽like he鈥檚 doing聽really聽well, but feels broke. His credit card is almost maxed out and he still hasn鈥檛 started contributing to his 401(k). The market has gone up聽during the past few years, and he really wants to invest, but doesn鈥檛 feel like he can bring home any less money each month and still make ends meet.

And although they鈥檙e close to paying off one of their cars, Brian and his wife believe聽they聽need聽a new one. Their neighbors, the Joneses, just got a new, top-of-the-line SUV, which makes Brian鈥檚 car look like scrap metal.

Their debt now totals more than the value of what they own, which means they have a聽negative聽net worth. Brian is moving backward financially: He owes more money than he did three years ago and because he鈥檚 not investing in his 401(k), he hasn鈥檛 been taking advantage of compound growth.

Charlie, on the other hand, is off to a fabulous start. Like Arthur, he鈥檚 accumulated about $10,000 in his 401(k). He also has聽close to $18,000 in his Roth IRA due to stock market聽growth.

Best of all, Charlie鈥檚 family just paid off the last of their nonmortgage debt. They鈥檙e on target to pay off their mortgage in five years, and their聽net worth is now around $100,000.

Falling behind

We all know people who fit in these three categories. There鈥檚聽Average Arthur, who never can get ahead but isn鈥檛 taking any action to change his situation.

Broke Brian is a little harder to spot because he聽appears聽to be doing so well, but he鈥檚聽never satisfied with what he already has. His financial issues become apparent only when he gets his car repossessed or has to file for bankruptcy.

Champion Charlie might be the most difficult to detect聽because he鈥檚 not flashy and doesn鈥檛 need to impress anyone. His main goal is financial freedom to create a better life for himself and his family. He hopes聽to move in a positive direction by acting on a few聽simple choices.

If Arthur and Brian don鈥檛 start to make better choices 鈥� even small changes 鈥� they won鈥檛 be able to achieve financial聽freedom. And if we were to check back in another three years, they would be even further behind.

One decision at a time

What these fictional characters remind us is that wealth is built one decision at a time 鈥� and the only person who can make those decisions is you. You might have an advisor or financial mentor who pushes you and acts as your accountability partner, but it鈥檚 up to you to lead your own journey.

Sam Farrington聽is a fee-only financial planner and founder of聽Sound Mind Financial Planning聽in Omaha, Nebraska. Learn more about Sam on NerdWallet鈥檚 Ask an Advisor. This article first appeared at NerdWallet.