Would you like to build more wealth and leave a financial legacy? Although there’s no proven way to get rich quick, there are three timeless principles you can follow to begin to build your fortune over time.
Make the right moves when it comes to managing your money. Many entrepreneurs keep a copy of “The Richest Man in Babylon” is by George S. Clason on their bookshelves. In this classic, Clason offers timeless financial advice through several parables. Here are some of those valuable lessons.
Pay yourself first.
Save at least 10% of all income earned. Even if you are paying off debt, 10% is still recommended.
Make Saving Automatic.
Automatically deposit that 10% savings into a retirement account, savings account or other investment vehicle.
If you get a raise, keep your expenses the same.
Avoid “lifestyle inflation” – this is when you increase your expenses as you start to earn more money.
Make your money work for you.
Earn more on investments.
Compound interest will help – this is simply interest on interest and it adds up quickly.
Reinvest the dividends.
Rather than cashing out, put the money elsewhere and watch it grow.
Create a passive income.
Get paid with high dividend or real estate investments.
If you don’t see a high return on investments right away, don’t worry! Your holdings might not pay off right away – be patient! You might need to keep them for a while to see large returns.
One of the most effective ways to build wealth is to make your money work for you. Passive income can be an easy way to grow your fortune – getting started is the hard part! Here is a quick look at the different types of investments to think about as you begin this piece of your wealth journey. If you’d like a referral for a great financial professional in our area, give us a call!