Knowledge is the first step to action. In order to build wealth, it is vital to have adequate information on how to go about it. The goal of building wealth is to create a comfortable future for you and your family.
So, what does it mean to build wealth? Building wealth is generating long-term income through multiple sources. Income not only means income that is generated through jobs but also income that is generated through savings, investments and owning income-generating assets.
There are three major types of income; earned income, passive income and portfolio income. The best way to build wealth is by incorporating healthy and consistent financial behaviour that shapes our financial habits.
This article will help you discover 10 actionable hacks on the best way to build wealth and achieve financial security. Now that you know why it is vital to know how to create wealth, let’s dive right in.
How do you build wealth on a low income?
Learning how to build wealth seems like an uphill task for most people especially on a low income. Wealth in most cases is associated with inheritance or having powerful connections.
Interestingly, a report by Wealth-X indicates that 67.7% of the ultra-wealthy individuals are self-made.
Even more, interestingly, there has been a surge in the ultra-wealthy numbers with a 10.0% increase in 2020 relative to 2019. This tells us that, first, building wealth is possible with low income and, second, wealth creation is happening at an even higher frequency.
The first hack to begin your journey in wealth building is investing in your education about money and learning how to grow wealth. This means introducing continuous learning in your lifestyle. While cultivating the culture of continuous learning about money and building wealth, it is also important to shift our mindsets about wealth before any transformation can occur.
In the words of Robert Kiyosaki, a business mogul and author, “Everyone has the ability to build a financial ark to survive and flourish in the future but you must invest time in your financial education to build an ark with a solid foundation.”
In order to achieve this, it is advisable to constantly listen to podcasts, take courses, read educational blogs and books to learn the basics and intricacies of money and building wealth.
It is worthy of note that the democratization of information regarding money and wealth means that there is a ton of inaccurate and misleading information available.
To ensure that you are getting the right information, follow credible blogs that will direct you to reputable investment opportunities, investors and financial advisors.
How can I get 100k in wealth?
Getting the first 100k seems very daunting and can be achieved easily by establishing your wealth creation goals and instilling discipline during execution.
The aim of establishing your financial goals is to see your future. Set your financial goals according to short-term, mid-term and long-term with reasonable timelines.
Ensure that your goals are realistic, measurable and written or charted out which makes tracking easier.
Once you have set your goals, it is the high time to break each goal down into smaller and achievable goals in years, months, weeks and daily. The golden rule for achieving your financial goals is prioritizing them.
In addition, you motivate yourself by creating a reward system, surrounding yourself with similar-minded people or pursuing financial literacy. This is a critical step in building wealth.
How can I get rich in 5 years?
Using the 50:30:20 budgeting technique could be a good start to get rich in the next 5 years but it is also possible to save a lot more with discipline and consistency.
This could be achieved by making use of a budget and the extreme savings strategy that is proven to help people achieve financial independence.
Putting together a budget helps you realise the items in your budget that you could get rid of. Another way to help you cut down your expenses includes making your own meals, taking up DIY projects and renegotiating the interest on your mortgage amongst others
How to build wealth in your 30s?
Now that you have learnt how to gain financial education, set up financial goals, budget and save, the next critical hack to learn to build wealth in your 30s is to build an emergency fund.
Basically, an emergency fund involves putting aside some money for unforeseen situations such as job losses or pandemics.
With such unexpected expenses, you may be forced to either take debt or sell your investments which results in having to pay interest on the debt or losing out on the amount of investment and the interest you could have earned.
In order to avoid such situations, it is advisable, especially in your 30s, to start an emergency fund. It is recommended that your emergency fund holds 3 to 6 months of your total monthly expenses. By doing so, you draw closer to building wealth.
How to build generational wealth?
In order to build generational wealth, it is important to explore different ways of earning passive income and passive investing.
You could make a passive income from either investment passive income or non-investment, passive income.
This has become even more possible in today’s global and digital economy that presents many opportunities to make extra income.
These opportunities include blogging, engaging in affiliate marketing, dropshipping and selling digital products.
Overall, investing, especially in passive income, builds wealth and helps us learn even better ways on how to grow wealth.
How to build wealth from nothing?
The best way to build wealth from nothing is to gain a regular income source and to continually improve your skill-set.
As an employee or consultant, for instance, you can get regular income through salaries or fees charged. To further get even more income, you can improve your skill-set which could cause earning higher salaries and fees.
If you start a business, it is vital to understand the market, provide better products and services, and provide greater value to customers to earn more income.
Regular income is a great way to start your journey to building wealth.
Can I build wealth with real estate?
If you are interested in building wealth through real estate, you can slowly and steadily do so by making wise real estate investments.
It is vital to take time to learn how to build wealth through real estate so as to get great returns.
One of the best ways to build wealth through investing in the sector is by purchasing undervalued properties, fixing them up and selling them at a margin.
Another way is to buy a rental property and rent it out.
You could also consider investing in REITs. There are many pros of owning real estate ranging from tax benefits and property appreciation.
How do I build wealth with credit cards?
Next, we are going to explore how to create wealth by leveraging credit cards.
The best way to build wealth by using credit cards is to maximize welcome bonuses to new cardholders and investing the cash rewards.
The first step to building wealth using credit cards is to acquire a good credit card from a credible provider.
The concept of building wealth involves generating long-term income from multiple sources which can be achieved through learning the best way to build wealth.
Fundamental motivation for building wealth is to attain financial stability for you and your loved ones. As outlined in the article, the proven ways on how to grow wealth include gaining financial education, establishing your financial goals, budgeting and saving steadily, building an emergency fund as well as investing in passive income.
Additionally, we have learnt how to create wealth by investing in real estate and leveraging on credit cards.
Learning how to grow wealth seems like a daunting task but that can be made easier by changing your mindset on building wealth and following the outlined hacks on how to create wealth religiously.
If you ask me, it’s totally worth it to be informed about how to grow wealth, which is the starting point to begin our journeys on building wealth.
FAQs on building wealth:
Wealth building is generating long-term income through multiple sources.
This is income that requires minimal effort to earn and maintain.
The best way to learn is by reading articles, taking courses and listening to podcasts on how to create wealth.
You can grow wealth in real estate by buying undervalued property and selling at a markup, purchasing rental property and renting it out, investing in REITs amongst other options.
Having learnt the most vital hacks on how to create wealth above, it is my belief that you are going to take action right away and begin your journey to becoming wealthy. Which of these hacks are you going, to begin with?