Many people don’t know how to properly build wealth in America. Part of this problem stems from a bad financial upbringing and education that we weren’t taught while in school. However, the good news is that building wealth is pretty straightforward and easy to understand. Many people are scared to invest but investing is one of the most powerful wealth-building tools. In fact, it’s the most important. In this article, I’m going to be breaking down my top 3 tips on how to build wealth
1. Increase Income
If you don’t have enough money coming in, it’s going to be very hard to build long-lasting wealth. Like they say, it takes money to make money. At the beginning of your wealth building process, you should be focusing 90% of your attention on increasing income and 10% of your attention on expenses. You can increase your income by starting a side hustle, getting a new job, or completing your degree.
2. Decrease Expenses
The fewer expenses you have, the more you’ll be able to invest and grow. Your main goal should be to increase the spread between how much you earn and how much you spend. I have found out that creating a budget is a tremendous help when tracking your spending. Also, save 15% of all income generated.
Once you have enough money in savings, it’s time to put that money to work. Invest in stable mutual funds that have a proven track record of success. In the end, this money will compound and you’ll be left with a pretty hefty nest egg when retirement rolls around.