Though success is a state of the mind and varies in the definition. At that, you can still distinguish between the rich and the poor. Every human aims for the rich category. Some people believe that joining the ranks of the rich requires some support from a wealthy relative or a billion-dollar idea.
Some who get help from a relative or venture
capitalist could get a head start toward becoming wealthy. It usually all comes
down to your drive to succeed in smart financial planning and this is why many
people go back to being broke even after having a taste of riches. Rich people
are very particular about building wealth and staying wealthy.
Here are four ways that they build wealth and
you may have been overlooking them; They let their money work for them not the
other way around. Conventional education teaches us to go to school get good
grades secure a job and start moving up the ladder while our parents and
teachers never told us that getting a job and working hard to build comfort was
a slow road.
I advocate going to school and getting a
degree, I hold a mechanical engineering degree myself but then relying on your
full-time job to build wealth means you will be limited by the number of hours
you put in every week. Rich people understand that building wealth doesn't
always require hard work a lot of times it requires smart work.
If your goal is to become wealthy then you
must look out for opportunities to generate new sources of passive income.
Passive income sources do not require your full attention they can run on
autopilot mode some popular passive income sources include investing in real
estate, index fund stocks, and royalties on creative works.
Here's a quick tip. You don't have to drift
too far when considering a passive source of income. If you must then seek
professional advice before you make any investment decisions, here's an
illustration of how you could expand your operations.
As a freelancer, I work full-time as a
freelance content creator, animator, and brand consultant. There is always a cap
on the number of hours I can work daily at peak performance. I could dish out
12 hours of work broken into bits to earn passively. I could expand my team by
bringing in two extra hands this way I'll be able to take on more clients, earn
more, and have more time to do other things.
The golden rule of passive investment is that
you should never invest in something you are unfamiliar with. The rich
are familiar with the spending process by prudent tracking of every of their
expenditure procedure this is called budgeting.
Do you know how much you spent on
entertainment last month, how much you were able to save? Rich people know
where their income goes, while, poor people on the other end just spend
contrary to the popular belief that rich people have lavish lifestyles.
Most wealthy people are not only frugal
spenders they budget and keep track of everything, money expert Chris Hogan
conducted a study on millionaires in his book everyday millionaires and
discovered that 93 percent of those interviewed stuck to their budget.
This is one of the secrets rich people have a
rough overview of how much they are expecting every month whether from salary
or extra income and they know where all the money is going. Having a budget
helps you stick to your money goals and reflects how you will achieve them.
When creating a budget think about your
short- and long-term goals, interact with your budget on the go, and if you
ever spend in one category look for a way to balance it up in another.
Finally, on budgeting, don't forget to set
aside at least 20 per cent of your income for savings. Most rich people use the
50, 30, 20 model, 50 per cent of their income goes into living expenses
like rent groceries, and bills, 30 per cent goes into entertainment and the
remaining 20 per cent goes to the savings account.
The rich know their most valuable currency
takes a short pause. What is your most valuable asset, if you said money then
you'd be wrong? Whilst poor people spend their time to save money, rich
people spend their money to save time. Time should be your most valued asset
and you should never waste it. It is possible to recover lost money but
impossible to recover lost time.
Rich people buy more time by delegating less
important tasks one of the early mistakes I made in business was trying to do
everything by myself. In 2016, I launched a pickup and delivery service that
allowed merchants to incorporate pay-on-delivery into their payment options.
My few attempts and recruiting employees were
unsuccessful, they just didn't have the same drive I did. So, I went from being
the founder to being the delivery guy. On some days, I spent over twelve hours
on the road.
I got the job done to my satisfaction but I
couldn't be in more than one place at a time pitching to new clients trying to
be innovative also flew out the window because that was generally exhausting at
the end of every business day.
Seek professional help, spill from knowing
your most valued asset. Don't try to be a jack-of-all-trades. The wealthiest
people are not often the most hardworking people or the smartest in the room. A
lot of the time they take expert advice before making investment decisions.
A financial adviser through experience may be
able to suggest the best investment strategies you may not have considered to
reach your financial goals faster. While some people may feel that hiring a
financial advisor would be expensive there are easier ways to go about this. I
have a banker friend and occasionally I seek his advice on how to invest my
money plus I also get early tips on what might happen in the banking industry
before it does.
If you can befriend a financial guru, in conclusion, wealth does not come overnight by being responsible with your money
tracking your spending buying more time, and asking for help when you need it
you can steadily build your wealth.
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