Let’s face it: We all want to have more money in the bank, but few of us want to do what it takes to put it there. Without a large inheritance looming on the horizon, it’s unlikely that you’ll build wealth by sitting on your duff. The good news is that there are practical ways that you can add to your bank account without sweating blood to do it.
1.Wants Vs. Needs
Wants versus needs is a lesson we learn in grade school. We are taught to distinguish between the things that we need to live and the things that we want to make us happy. The next time you’re standing in the aisle of your favorite store, ask yourself if the purchase you’re about to make is something that you need. If it’s not, walk away from it and put the money that you would have spent in an envelope. At the end of the month, take your envelope down to the bank and deposit its contents into your savings account.
2.Make Your Money Work
Many people are under the mistaken impression that they need thousands of dollars to begin an investment account. The earlier you start investing your money, the bigger your return. Stop to consider how much more you will save if you start socking away $300 a month when you’re 25 compared to how much you’ll have if you don’t start investing until your 45. The math isn’t difficult to do. No matter how much money you have on hand to start building your portfolio, get to it.
3.Pay Off Debt and Stay Out of It
It does no good to pay off your debt only to build it back up. Work hard to pay off your debt, cut up your credit cards and start using cash. Unless it’s an emergency, you shouldn’t pay for anything that you can’t buy outright. If you aren’t currently in debt, consider large loans that you can work on paying off early. Do you have a mortgage? Perhaps you have car or student loans. Look for ways that you can dedicate extra money to these bills each month in order to pay them off sooner than you had planned.
4.Hire a Professional
Sure you know how to open a savings account, but do you know how to build wealth? Most people have little understanding of best practices when it comes to building a healthy savings. A financial advisor can sit down with you, discuss your goals and help you develop a plan that will help you meet those goals. If you’ve got a thousand dollars to invest, you certainly can afford the advice of a professional.
5.Get a Second Job
Remember way back at the beginning of this article when we said you wouldn’t have to sweat blood to make money? We meant it. A second job doesn’t mean that you have to work 40 more hours a week. Find something that you enjoy that you can do part-time or even from home. Even if you make minimum wage, working just 15 extra hours each week will give you close to $400 each month that you can put away.
If you want to retire before you’re too old to enjoy yourself, you’ve got to start making money. If you follow the tips above, you can begin building wealth immediately. It’s the only way to go if you don’t want to work until you drop.
About the Author: Aaron Keenan is a full-time finance blogger. If you have questions about building wealth and how to pay less tax, consult with a McKinley Plowman CPA.