Creating wealth on any salary
Creating wealth is something that many people put off until they are "earning more money," "have paid off some of these debts," "are done with school," "have kids a little older," etc. There are always going to be excuses or situations where you justify putting off your acquisition of wealth for another time. Most of those are directly tied to the amount of salary or income you are currently making. The problem with this logic is that as your earning increases, so does your "needs". So, if you use this logic, you will never acquire wealth.
|
|
Your salary has little bearing on your ability to obtain wealth. The following is a quick summary of how you can create wealth on any salary.
- Save ten percent. No matter how much you make if you save for yourself at least ten percent, you will then have some money that is yours, and you will be on your way to creating wealth. The money you make is not yours if you have committed it elsewhere, so be sure to save a minimum of ten percent for yourself.
- Once you have saved enough to cover yourself for 3-6 months, start investing the 10%. Having a savings is going to help you get to wealth because you will wiser with your money. Studies have shown that people who have a nice chunk of money in the bank are wiser with their spending, and smarter with their investments. Once you have enough to keep yourself up for 3-6 months without any income coming in, you can start taking that ten percent you are saving each month, and investing it. This means you are going to let your money earn you money, instead of doing the work yourself.
- Invest in things you know, or with people who are qualified. If you want to achieve wealth, you can't ask the diamond appraiser to invest in cattle for you, you would want to talk to the cattle rancher. So, invest with people who are qualified to make investments, and educate yourself so that you are not making unwise decisions unwittingly.
- Let your money work for you, continue investing your 10%, and watch your money grow. This is where you sit back and continue investing your ten percent and letting your money multiply. If you invest wisely, you will see returns, even if they are small, letting your money earn, and that money earn, and that money earn will help you achieve wealth.
- Protect that money by controlling spending, eliminating debt, and having insurance. As you earn more wealth (no matter what you salary) you have to protect that wealth by not falling into bad habits of over-spending, etc. You should also make sure you have insurance so that if something happens your wealth, assets, and estate are protected.
