Building wealth is as elementary as saving a little bit here and a little bit there. You need not have great riches in order to accumulate wealth, but you need to have the drive, determination, and discipline to successfully increase your wealth. Let’s look at 6 proven wealth building strategies you can put to use today.
2. Save Now. The earlier you start to save in your life, the more you will have later in life. Of work, if you aren’t able to save much until after your babies are grown, you can step up your savings until you retire and still have a decent nest egg.
1. Pay Yourself First. If you do not set aside currency before you start paying your bills, chances are you will never save any lots of after you pay these same bills. If your employer has a 401(k) or 403(b) plan, enroll in it and set up a reasonable percentage to invest. The currency will come out before you see your paycheck, therefore the “loss” of discretionary income will be less noticeable to you. Maximize your contribution if you are able, if your employer matches your contribution.
3. Get Rid of Debt. Even before you build up your savings it is best to get rid of your debt first before starting a wealth building campaign. If your credit card rate is 14% you will find it difficult to find any investment that gives you a return that exceeds that rate. It would be better for you to pay down your debt first and then implement an investment strategy.
4. Pick The Right Mortgage. If you plan on holding onto your home for a short period of time, select an adjustable rate mortgage as your rate will be lower than a fixed rate mortgage. Use the amount saved to pay down your mortgage quicker; refinance your home if rates begin to climb.
6. Protect Your Assets. You can have a healthy portfolio and see it disappear quickly if you aren't properly insured. Make sure that your health/dental, homeowner, life, and disability insurance coverage is adequate to meet your needs. All it takes is three legal judgment against you to wipe out your assets.
5. Build An Emergency Fund. Nothing wrecks the best laid plan more than an emergency, particularly three that costs you currency. Set aside up to three months of your income to live on in case catastrophe hits. Without an emergency fund you will be tempted to take on debt, currency in your retirement accounts, and sell valuable investments. Try recovering quickly from this sort of hit to your wealth without an effective back up plan!
Instance riches come to a few, but most riches are realized after careful planning and effective management of your resources. You can properly prepare for the days ahead by implementing these three proven wealth building strategies today.