There are so many ways to build wealth. From smart stock market strategies to learning a specialized trade, the methods for making your money work for you seem endless. So which one to choose?
Here are the top five:
Start Your Own Business
Who actually wants a boss? Creating your own job is one of the most satisfying ways to build wealth. Plus, people don’t realize all of the additional advantages that come along with being a business owner. The absolute best is the money you save in taxes since everyday expenses like your car become a “business expense” to write off.
But really, with more and more traditional jobs being taken over by computers, systems and technology, becoming a business owner is an excellent way to pave your own path. And — of course — to build wealth.
Want to try it out first? Feel like stretching your entrepreneurial muscles? Either brainstorm your own side hustle or drive for Uber! Help someone move using TaskRabbit! Rent your apartment on Airbnb!
Invest in Real Estate
If you’ve thought about how to snowball your money but haven’t considered real estate investing, then I’m not sure where you’ve been looking. This is NOT about owning the house you live in; this is about buying a home and having someone ELSE pay the mortgage. Who gets the tax benefits? You. Who gets the passive income? You. Who gets the equity? You. The list goes on…
There are many different ways to invest in real estate, and here at Investor Junkie we actually walk you through how to get started. But as the saying goes, “In real estate, the money is made on the purchase, not on the sale.” So overpaying for just one property can severely affect how well you build wealth through real estate investing.
Want to just dabble? Thanks to technology, there are lots of ways to invest in real estate that don’t have you fixing faucets or needing $50k in cash.
These are our favorites:
- Fundrise (you need only $1k to start)
- Roofstock (with this one you actually do own the home yourself, but Roofstock makes things seriously easy)
- Realty Mogul (this platform offers two REITs for non-accredited investors)
Pay Yourself First
Have you ever heard the saying pay yourself first? If you truly want to build wealth, this is the way to do it. But what does it mean to pay yourself first?
Each month we all have bill to pay: credit cards, mortgages, rent, student loans, etc. But what if instead of prioritizing BILLS, we prioritized OURSELVES?
The easiest way to do this is by setting up automatic deposits from your employer to go into retirement accounts. This way the money never hits your bank account, where it can be redirected to landlords and credit card companies. Instead, the money goes directly to your future self so that compound interest can work its magic. There are employees who followed this strategy and woke up one day to realize they had enough in retirement accounts to quit their jobs forever.
This isn’t to say that you can ignore your financial responsibilities, but it does mean that you should rearrange your priorities so you’re building wealth for yourself and your family, instead of padding someone else’s pockets.
Need more info? Start with learning the maximum amount you can contribute.
Take Calculated Risks
Wealthy people, in general, do not sit in a cubicle day in and day out. Sure, sitting in a cubicle earns you a secure paycheck and… yeah, that’s about it. To really build wealth you’ll need to get out of your “comfort zone” and explore risk. Calculated risks are the key to personal growth, and the same applies to money.
So whether it’s studying the financials of a company you love and buying its stock… or putting a down payment on a home you’ll never live in… or creating an LLC for the company you’ll one day run… You’ll never know wealth until you take these first calculated risks.
View Wealth as a Long-Term Goal
Building wealth is not a fast process. It’s a goal that will take patience and discipline to achieve. But by using these simple strategies, you’ll be able to accumulate wealth and have it last through retirement and into your family’s future. If you view investing in your future as a long-term goal, you’ll already be on your way to building wealth.