How to build wealth?
How to build wealth? Many of you may wonder how to build wealth when you are still students who depend on parents. How to build wealth when you have tons of bills to pay or debts which are due. The answer is there are always ways. However you will need to figure out which ways will work for you. Here are 4 ways on how to build wealth that I would like to share. You should practice, follow and combine these 4 to build your wealth.
Build wealth by savings
You can build your wealth by saving. It is simple and possible. It does not matter how much you make, but how much you can save will make a change. A person who makes millions can be broke one day. However, another person with a modest income can become rich by saving. Therefore, it is so important to save. You should learn how to save by making a budget. Simply, you can create a spreadsheet and keep track of how much you earn, spend and save. It is easy to say, but it is hard to do. Therefore, you should practice to save and make it become your habit. When saving becomes your habit, it will be hard to not save. Practically, each person only needs basic things to live.
For example, you basically need a place to sleep, food to eat, water to drink, clothes/shoes to wear and loyal family/friends. Depending on your situation, you may learn to make adjustments on your spending. Whenever you plan to buy things, simply ask yourselves if you need it or you want it. Always keep track of your spendings. If you have $50, and you spend all $50, then you will have zero. However, if you know how to budget, you need to spend only $30, then you will save $20 in your account. Many $20, or even $1 saved on unnecessary spending will accumulate into $100, $1000, $10,000 and more throughout your life. At some point, you will realize that you become rich and look back in awe at how those small savings all added up.
It does not matter that you are a 5 year old child or 70 year old adult, you can learn to save. Saving is important. Save to secure your future, to ease your mental stress and help yourself for unexpected situations when you need to use your savings. Stay healthy, work and continue to save, then you can build your wealth.
Build wealth by investing early
You can definitely build wealth when you invest wisely. You invest so that you can save the days that you don’t have to work. Nowadays, investing has become easier. You can save $5 everyday and invest that $5 everyday. With saving that $5, you can own a portion of a corporation by investing in stocks. Simply, you can open a brokerage account with any company such as Robinhood, Webull, Charles Swabs, Fidelity, Etrade, then start to save and invest.
The earlier you start to invest, the better your investment will turn into
If you are young, you have the advantage of multiple years to grow your investment before you retire. Even though stocks are volatile, the stock market records show that stocks grow over years. Simply, you pick good stocks, invest for a long term and patiently wait for your stock investment to grow. You will witness the decade of disruptive technology and massive growth of e-commerce, bio- engineering, robotics and so on. You should take advantage of the length of investment years. Don’t let the chance of investing and building wealth go by.
It is never late to invest
If you are about to reach your retirement, you still can save and invest for your retirement. However, you need to have a suitable plan to invest in order to secure your retirement. It means you need to invest in secure stocks such as Google, Apple, Amazon, Microsoft, etc and other stable investments. Due to inflation, goods and service prices have increased. When inflation happens, the currency is worth less and consumers have to pay more for higher prices of goods/services. Also, your money will be depreciated through years. Therefore, you should not let your money sit freely in your bank account. Instead, you should invest wisely and make money work for your retirement.
Practically, you do not need to be smart like Steve Jobs, Jeff Bezos, Elon Musk, or Warren Buffet to become rich. With a little money, you can invest in their talent, invest in their business. Then, you can grow your wealth. Always remember to save as much as possible, invest as early as you can and allow your investment to grow. You can also expand your investments to real estate and other investments to build your wealth.
Build wealth through taking opportunities
You can build wealth with opportunities. You should ask yourself, what you are good at. What is it that you can be the best at and have sufficient passion for so that you never give it up easily.
Nowadays, you can make money in multiple ways. The Covid-19 pandemic has changed people’s perspectives toward their life. People want a better quality of life. With modern technology, people have turned their hobbies into million dollar businesses. A 10 year old child or a stay home mom can own a million subscriber Youtube channel and earn a lot of money. There are multiple ways that you can build wealth. You can earn income by becoming a freelancer or running side hustle businesses where you can sell your hobby, your skills or your passion. For instance, you can start a youtube channel, write a blog, sell stuff on Shopify/Etsy, clean houses, walk pets, offer child care, sell online courses and so on.
Success may not happen in a short period of time. Choose the right fit and focus on your strength. You should have a goal and work towards your goal. Also, don’t forget to continue increasing your knowledge. As long as you can earn money, live comfortably and happily, you can overcome challenges and work things out. One day you will become successful and build up your wealth.
Build wealth by building good relationships
You do not need to have a wealthy family to build wealth. However, it is important to have good relationships. The relationship can be a friendship, a spouse relationship or a business relationship. Good relationships benefit you in many ways.
Build good relationships in personal life
When you grow up, you will spend most of the time with your friends, with your roommates, classmates or soulmates. Certainly, a part of you is inherited from your parents. However, you can always learn from the surrounding environment. You learn from what you see, hear, and experience. For instance, college students choose to go to prestigious schools, not only to access the rich resources for study, but also to build an influential network including experts/specialists that would lead to job opportunities or lucrative careers after graduation. You don’t need to have a large network to be successful. But, you should be selective about peers who influence you. You don’t have to be an extrovert to make good relationships. However, you can be a good listener who listens with your full heart and listens to help others.
Moreover, marrying the right person can double your wealth. A study of Ohio State University’s Center for Human Resource Research showed that married couples can increase almost 93% of their wealth compared to being single. On the other hand, a divorce can reduce a person’s wealth by 77%. So when you get married with the right person and as long as you do not divorce, you can double your wealth.
Build good relationships in doing business
Finally, good relationships not only play a key role in your personal life, but also in doing business. Many successful businesses are involved with good relationships with employees, customers, business partners and the business community. For instance, in 2021, Costco was ranked #6 of the world’s largest corporations by total revenue according to the National Retail Federation report. The company is also well known for its customer focused policy and employee benefits. It was ranked the top company providing great benefits and compensations according to Indeed’s 2018 report.
