Picture this scenario with me, you’ve worked 2 jobs for years, made meals and coffee at home, and cut everything from your budget that didn’t fit your lifestyle of frugality. Then the day finally came, you’re officially debt free. All the loans that were tied to your name have suddenly been released and you are saving the most money you’ve ever saved in your life.
So what does this mean for you? Is it time to park your car on easy street? Should you just enjoy this season of your life and do nothing? No, don’t do it. If you can remember one thing in this article, remember this; MONEY NEVER STAYS STAGNANT. It’s always moving.
Debt has taken a toll on all of us and caused us to move backwards by paying extra on what we owed (interest). Now that we finally got rid of it, it’s time to move forward and grow our money into new heights.
So what’s the next steps after paying your debts? Build wealth.
I was very intimidated by this phrase at one point in my life. I used to say, “as long as I have enough to live off, I don’t need much.” But then I realized, I would need more than enough so my kids can have an inheritance, I need more than enough if I was disabled and didn’t want to be a burden to my family, I need more than enough to house someone in need.
I realized building wealth is more than just having lots of money, it’s about having lots of options. It also doesn’t have to be difficult. I wanted to share with you 4 ways you can build honest wealth.
1. Pay yourself first
If you work a full-time job and the company offers a retirement plan, take it. The younger you do this, the better off you’ll be. When you invest into your company’s retirement plan, that money is usually pre-tax dollars, so you’re eventually paying yourself before paying the government. It’s up to you what percentage you want to pay yourself, but according to the book Automatic Millionaire, it’s best to invest 20% of your own money into your retirement plan if you want to grow your wealth faster. Having a company match is icing on the cake.
2. Get real estate
I consider real estate the gift that keeps on giving. If you have a property there are so many ways you can make money from it. How so? Well, properties usually appreciate over time, you can also rent out your property as a form of passive income. I have to mention the great tax breaks you receive for owning multiple properties. You don’t have to own many units. If you own 2-4 properties, you can still build significant wealth.
3. Create digital assets
Do you have gifts and talents? Sure you do, we all do. Within those gifts and talents that you possess, perhaps you can create a product that can help or entertain certain people. It’s best to create something digital. Something that requires work on the front end, but little effort on the back end. Some examples include e-books, worksheets, lifestyle videos and online courses.
4. Establish a business
When you have a business, and it actually gives you a profit, it does something on the inside you. You begin to grow in confidence. Because you have your own. You are the founder and the CEO. You can also control the growth of your business, who you pass it on to, and how much you make from it. Most millionaires today acquired their wealth by having a business or multiple businesses.
There are other ways of building wealth, but I really like the methods listed due to my simplistic lifestyle and mindset.
How will you be building wealth this year or in the years to come?