Building wealth can be accomplished by anyone who puts their mind to it. Most of it is based on simple discipline and math. I have already begun to build my wealth, and will continue to do so for the rest of my life. Listed below are 3 easy ways to build wealth, from a guy who did it.
Automate Your Savings:
Have you ever heard the saying, “You can’t spend what you don’t have”? This is why automating your savings is so important. Contributing to a company 401k plan is an easy way to do this. The money is taken out of your paycheck before you have a chance to spend it. This savings is simply automated. Saving first and spending what remains is how many people achieve wealth.
Invest with Simplicity and Confidence:
Investing one’s savings isn’t rocket science, although some money managers and hedge funds will try and tell you it is. Many companies, such as Vanguard, Fidelity and others offer low-cost mutual funds for the novice investor. You don’t have to worry about picking stocks or making sure you have the right mix of stocks vs. bonds. Pick a mutual fund that you feel most confident in. For example, I invest in a mutual fund that tracks the performance of the S&P 500. Many companies offer them and they are easy to setup.
Have a Long Term Perspective:
The only way wealth can be built in a short period of time is through luck. Don’t rely on luck to build your wealth. Instead, have a long term perspective on it. Building wealth takes time. It’s important that you don’t worry about the stock market when you’re trying to build wealth for the long term. Stocks will go up, and they will go down. They might even lose close to half their value like in the recent recession. With a long term perspective, you stick it out through thick and thin. Most importantly, YOU KEEP INVESTING!
Conclusion:
In today’s climate, everyone is looking on how to make a quick buck. The reality is that there is no tried and true way to accomplish this. However, there is a method that stands the test of time to build wealth. By following the 3 easy ways to build wealth, from a guy who did it above: automating your savings, investing simply and confidently, and having a long term perspective, building wealth is not that far-fetched of a goal. Compound interest is a beautiful thing, and when followed correctly, it makes building wealth one of the easier things in life to do.
Budget Smart, Invest Wise
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James Hendrickson is an internet entrepreneur, blogging junky, hunter and personal finance geek. When he’s not lurking in coffee shops in Portland, Oregon, you’ll find him in the Pacific Northwest’s great outdoors. James has a masters degree in Sociology from the University of Maryland at College Park and a Bachelors degree on Sociology from Earlham College. He loves individual stocks, bonds and precious metals.