It can be hard to figure out where to start when it comes to building wealth. What are some of the most important things I need to know? How do I get started? If you want to be successful, you have to start early. In this article, we’ll cover what you need from a financial perspective, how best to achieve your goals and I’ll share some tips on how to get started.
First and foremost: It’s never too late to start investing. The sooner you get started, the more time your investments have to grow and provide for you. Building wealth is not a linear process- it takes dedication and patience over many years.
Second, and I’ll try to keep this as short as possible: Don’t just do it for the money. Do it for something deeper than that. Find your “why”, have a purpose to embark on your wealth building journey, a goal, and believe in yourself!
Think BIG!
Third: Time flies, therefore the most important thing is: Get started!
Let’s dig in.
Spend Less Money
The very first step to building wealth is to spend less than you make.
This sounds almost too simple, but believe me, there are people who do not realize this. If you need help to get better at this, track your expenses, create a budget – and stick to it – and simply figure out where your money comes from and where it goes to.
Trust me, cutting back on expenses is the easiest place to get started to build wealth.
Too many people spend money they haven’t earned to buy things they don’t want to impress people they don’t like.
Will Rogers
Focus to reduce your spending on the so-called big three, housing (rent/mortgage), transportation (car, mobility) and food (groceries, deliveries and eating out). If you start here, you can “free up” the most! Did you know the average household spends more than 60% of their monthly earnings on the big three?
Another hack is to simply “pay yourself first”. This means nothing else than you proactively dedicate a percentage of your income – the moment you get paid – and invest it in your diversified investment portfolio. Way too many folks still have too much month left at the end of their money, become one of those who have more money left at the end of the month by paying yourself first. Automate it if must be.
To reduce your expenses fast, get creative, marshmallow-test yourself, use geographic arbitrage, cook and bake more at home, cut your own hair and so forth.
Cutting down expenses is an essential start, but it’s also the most capped wealth hack as such.
You can’t cut back your expenses below zero!
Get Paid More
Start by getting paid more – by asking for a raise. Find ways to provide more value at work, get better at what you do and optimize your 9-5 before doing anything else. This gives you the most upside in the short term.
In the mid to longer term though, find your Ikigai! Identify what you’re good at and start selling it. Test the market by offering your value in the form of a side-hustle first. Ask for tips and honest feedback from your clients, learn from this and keep improving your offering.
Think from the customers’ perspective. Learn how to solve problems.
The bigger problems you can solve, the more time you help others save, the more valuable you will become and the more clients you might reach.
Figure this out.
If you become a “master problem solver” the monetization of your Ikigai will be a simple formality, that’s when you could start building your own business around it.
Keep track of the value you provide and how you best invest your time and efforts. Eliminate your time bandits and figure out ways to leverage your offering and ultimately raise prices on your products and services once you reach a level of saturation.
The more time and money you help other people save, the more valuable you will become!
The rich invest in time, the poor invest in money.
Warren Buffett
Stay creative with side hustles to make more money.
Read my post about creating an abundance of income streams.
Invest Your Money, Your Time, Yourself to Build Wealth Faster
Remember, you can invest more than just your time or money. You can invest in yourself too! So if you want to build wealth faster and get more effective at the process, make sure that education is a big part of what you invest.
Invest into YOURSELF!
Stop spending your money.
Stop spending your time.
Start investing them.
Build Wealth!
If you want to go BIG, stop thinking small.
Set-up a wealth building structure. Think and dream big. Give your dreams deadlines and make them become goals. Stop just dreaming about a better life, and start living a bigger, better life. Financially imagineer your life!
In essence, the key to building your wealth is to start by increasing your free available cash flow, then keep investing excess resources such as cash and time into assets such as ETFs, funds, real estate as well as into yourself through education and training.
Optimize for higher yielding assets and investments over time, stay the course, and keep adding to it!
Once this part is done, stay patient and let time do the heavy lifting!
Financial Imagineer is dedicated to help people build wealth. We offer expertise on wealth building, investing, retirement planning, and more – so you can live a life of abundance. If you’d like to get more investment ideas, tips and tricks or learn how to make your money work for you to speed up your wealth building journey, build up and improve your financial literacy follow my blog on Facebook, Twitter and sign-up by email in the box below for our free content and regular updates on this topic.
Together with Yasi of the Fast-Track Podcast we also do interactive weekly live sessions on YouTube and Facebook covering all kind of topics around money and wealth building, you can ask us questions during the show! We also offer regular free webinars and have built a money course for people more interested to fast track their wealth building journey!
If you’re not sure where to start and like to connect 1:1, please consider starting with a free wealth management consultation with me.
Now, get started building wealth and take the first step to financial freedom!
Thanks
Matt
Very solid advice. In a perfect world I think people should start thinking about this even earlier, prior to picking a college major. I picked a vocational major, chemical engineering, which is basically a more complex version of plumbing to be honest. But like being a plumber, it pays very well and normally there is always a demand for what engineers do. I selected that career based on what I liked to do and what I was good at and it rewarded me in both job satisfaction and income. Engineering is not for most people, pretty much limited to nerds because of the math and science requirements, but everyone is good at something and planning a career before selecting a college major or a skilled trade apprenticeship can give you that perfect tool to build wealth, a larger than median income.