1) Material possessions are not a sign of wealth. Material things won't make you a wealthier or happier person.
2) Don't buy liabilities to look wealthy, buy assets to become wealthy. Invest in assets so that they replace your liabilities over time
3) Educate yourself on personal finance & investing, and your wealth will grow in abundance. Being financially literate will change your life
4) Pay-off & eliminate high-interest debt. Consumer debt delays wealth creation & hurts your ability to invest in your future. Consumer debt robs you of your future, because you are using money you earn today to pay, off things from your past.
5) Create multiple steams of income from a side-business or side-hustle, so that working 40+ hours a week becomes a choice, and not an obligation. Create multiple sources of income, because only having one, is one away from zero.
6) Surround yourself with mindsets which to help you grow, not hold you back. Create a network of friends who discuss opportunities to make money, not just spent it.
7) It’s not about how much you make, it’s about how much you save and invest.
8) Find ways to reduce expenses. The quickest way to increase income, is to reduce expenses.
9) Be more frugal & spend less than you earn. By being frugal you are being more resourceful with money. Being frugal is prioritizing your spending on what is important to you in life.
10) Budget to know where your money goes, and make a plan to reduce expenses. Creating a budget can help you better track your money. Not having a budget can make it difficult to know where you are spending your money, or difficult to have control over your spending in general.
11) Avoid lifestyle creep. Just because you start making more money, doesn’t mean you should spend more money. Making more money doesn't fix poor spending habits. Increasing your lifestyle expenses without increasing your income will causes expenses to build up in the long run.
12) Establish an emergency fund to cover 3-6 months living expenses, for unexpected events. Everyone needs an emergency fund so that you have access to money in a pinch. The best option for an emergency fund is a High Yield Savings Account, you earn interest while the money sits.
15) Create financial goals & hold yourself accountable. Figure out what you want and align your actions to your goal.
Create a strategy and maintain a long-term mindset.
16) Invest for your retirement through SIPs and RD scheme of Bank and Post office. Retirement isn't an age, it’s a number in an investment account. Investing for 20 years may be hard, but being old & broke will be a lot harder.
17) If you don't know where to start investing, buy SIP Feature in Mutual Fund
For example, if you invested $10,000 in an S&P index fund, and contributed $10,000 a year for 20 years, you would have invested a total of $210,000 cash, but this amount would have grown to $793,275 based on the S&P 500’s historical records of an 11% rate of return compounded.
18) Get your credit score in order. Having a good credit score makes life a lot easier and will save you thousands!
The higher your credit score, the more likely you will be approved for a loan. Your score helps lenders assess how much of a risk you are, in terms of paying back your line of credit. If you are a high risk, you will have a hard time finding a lender to let you borrow money.
19) Real estate is a great investment vehicle. Renting only provides shelter, but owning provides numerous benefits such as:
• Build equity
• Provide tax incentives
• Create cash flow which will increase your income
• Appreciate in value which will increase your net worth
20) A car is a depreciating asset. If the cost of your car payment higher than your credit score, you don't need it. Don't overspend on an expensive car, just to go to a job you hate.
21) Don't buy "too much" house! If you take on too high of a mortgage payment and fall behind, you risk foreclosure. If you take on too high of a rent payment, and can't keep up, you risk eviction. You could end up homeless from overspending on housing.
22) You can't “save” yourself to wealth, you must invest. Everyday your money sits in a bank, you are losing money. With inflation over 8%, you lose half the value of your cash in 10 years.
The richest 10% of Americans own 90% of all stocks, the bottom 90% own 10% of all stocks.
23) Always consider opportunity cost. If you make $20/ hour:
• that night out isn't $300, it's 15 hours of your time, or 2 days of work
• that car isn't $50,000, it's 2,500 hours of your time, or 357 days of work
Time is your most valuable asset, don't waste it
The secret to building wealth is:
• Find ways to increase income (with investments, side hustles/ side business)
• Find ways spend less than you earn (by being frugal/ budgeting)
• Invest the difference
It’s not about how much you make, it’s about how much you save & invest
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