Have you ever wondered how the wealthy of this world do it? How do they build their wealth and keep building it? How do they escape the constant stream of people who are living paycheck to paycheck or worse, claim bankruptcy? What are the secrets of successful rich people that enable them to earn more money? This video answers these questions and more about how the rich build wealth that the poor don’t. By following these simple tips on how to get rich from nothing, you can change your financial outlook from bleak to rosy in no time! Leave A Like Down If You Love Creating Wealth.
- Save 20% of Your Income And Invest It
By saving 20% of your income, you’ll be able to reach your financial goals and boost your chances of building a secure retirement nest egg. Since your nest egg is comprised of investments that are invested in index funds, it’ll grow with time without much effort on your part (barring any major economic crisis). Over time, regular savings and investment plans can significantly increase your net worth — for instance, if you invest $20K per year for 40 years at a 6% annual return rate, you’ll have over $3M by age 65!
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2) Invest In Yourself
One of Warren Buffett’s best quotes is, You don’t need to be a rocket scientist. Invest in yourself. While having a little book smarts doesn’t hurt, education and knowledge are valuable, not just for your brain, but also for your wallet. Investing in yourself means many things including learning new skills, reading books, listening to podcasts, and watching educational videos. Increasing your knowledge about key topics such as how to make money online will give you an edge over others who are uneducated or less financially literate. Learn from thousands of free courses online on websites such as Udemy, Coursera and even youtube! Invest time and money into yourself to get the biggest return on investment.
3) Create Multiple Streams Of Income
Investing in index funds is a great way to build up your wealth without having to rely on one source of income. If you’re committed to creating multiple income streams and adding value, your best bet is to focus on high-potential, undervalued investments and let time do its job. This approach has worked wonders for investors since the start of time. Create different sources of income — work a main job while building multiple streams of passive income (blogging, affiliate marketing, dropshipping). What’s more, once your savings are at a comfortable level, you can use them as investment capital. Maybe you can use that money and invest in Real Estate to generate cash flow for many years to come. Or if you want to earn more passively maybe invest in REIT funds, it’s only a few clicks away!
4) Use Good Debt As Leverage To Sky Rocket Your Net Worth
When you’re young, debt is good. Just make sure you use good debt as leverage to boost your net worth and create generational wealth. Good debt — including mortgages, student loans, business loans, and personal loans — offers built-in growth opportunities for your income and net worth over time when used correctly.
Student loans are an amazing example of how to make money with good debt. The average college graduate in 2016 carried more than $37,000 in student loan debt — and that doesn’t include undergraduate or graduate school debt for parents! A lot of people see that number and cringe, but using it as leverage can create generational wealth opportunities when used correctly. Investing even a small amount each month from your net income into a high-yield online savings account could generate thousands of dollars in interest over time without impacting your regular spending habits too much, allowing you to potentially retire those student loans years before your friends and family ever do!
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Another Example is mortgage payments, to create generational wealth. This can be done by purchasing a home for cash and renting it out at a positive cash flow (you collect more in rent than you pay in mortgage payments) or you can use your current home as leverage to invest in real estate that will generate positive cash flow (like an apartment building). Yes, I know buying property for investment purposes can be risky — but if you don’t want to risk it all and are OK with sticking to residential properties, then smart real estate investments could be a great way to go.
5) Spend Within Your Means
Did you know most lottery winners end up bankrupt after winning? Do you know why? Lifestyle Inflation! They spend all of their winnings on lavish things and don’t understand the financial consequences in the future.
Lifestyle inflation is a big part of what keeps people from building wealth — but in many cases, it’s just a matter of spending less than you earn and saving some money for future investment. If you can put your focus on lifestyle inflation, one of the biggest reasons people never build their wealth is eliminated immediately; after all, you’re just not spending as much money on things that don’t make you any more successful or give you any better opportunities. For example, when someone tells you they won $20,000 in free cash — take them up on it!
But you have to spend it within reason: Don’t blow all of your winnings at once, but do think about how to use that windfall to boost yourself toward financial success. Remember: Spend within your means and save money for later so you can invest in yourself first. When you learn how to start investing in yourself, there are unlimited ways to grow your income stream over time — and save thousands each year while doing so.
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For example, instead of going out with friends on a weeknight, stay home and read a book or watch a movie together online. By not spending money on entertainment that doesn’t give you any kind of lasting value (which is usually what people mean when they say they spent too much on entertainment), you could be setting aside more than $100 per month if you don’t drink or go out very often. That might not seem like much now, but 10 years from now, if you’ve put away $10 every month for 10 years into an investment account earning 7% interest (not unreasonable), those savings will be worth nearly $3,000!
5.5) Develop Good Habits Early
If you want to become rich, developing good habits early is imperative. You can’t achieve big things without taking advantage of small wins. According to a study in Translational Psychiatry, children who read for pleasure not only outperform peers on academic tests but also score better on IQ tests. By getting into a habit of reading and self-educating in your free time as a kid, you’re developing skills that could make you an expert in any field by your adult years. Therefore, good habits help rich people build wealth because they act as passive revenue generators through multiple avenues like starting their businesses or investing knowledge capital acquired from books.
There is an excellent ebook on how to stop bad habits that you may have formed called Stop Addictive Habits
One of the best ways to develop good habits is to be productive with your mornings. Waking up early and getting into a routine can be incredibly powerful for any entrepreneur, especially those trying to build their wealth. It might seem counterintuitive since most entrepreneurs work best late at night, but research suggests that morning people are more successful than night owls. Morning people are more ambitious and have a stronger sense of time urgency (meaning they feel like they need to get things done faster). Their drive stems from an internal locus of control — they know they’re going to make something happen because it’s already inside them, not because of external pressures or circumstances outside their control.
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Anshjeet Singh 