Tag building wealth

Learning how to build wealth demands knowledge of making an investment plan and adopting a long term mindset. Steps to build wealth include starting by making a plan, making a budget, building emergency fund, automating financial life, managing debt, maxing out retirement savings and staying diversified.

Starting by Making a Plan

It is a well known fact that making a financial plan is the very first step of building wealth in the contemporary digital era. According to prominent personal finance experts, building wealth begins with a vision and plan. Seeking the services of a financial advisor is an excellent way to begin making plan for building wealth.

Making a Budget

Making a budget and sticking to it are essential as far as building wealth in the contemporary era is concerned. Budgeting is a vital part of wealth building strategy and it leads to achieving financial goals effectively. Investors can understand where their money goes each month with budgeting and it is helpful in preventing behaviours that can endanger our goals just like overspending.

Building an Emergency Fund

An emergency fund is helpful in protecting credit and reaping the attractive benefits of earning interest on an online savings account.

Automating Financial Life

It is a great idea to make saving, investing and bill payment automatic. Automating financial life is helpful as far as saving and investing are concerned. Investors can resist the temptation to spend rather than invest with automating saving, investing as well as bill payment.

Managing Debt

It is a fact that not all debt is created equal and mortgages are often considered as good debt due to its low interest rate and wealth building potential. Mortgage payoff is often considered as a kind of forced savings account because we will see a portion of our monthly payment back when we sell. High interest credit card bills jeopardize our financial goals and it is quite important to have a plan for repayment. Debt snowball and debt avalanche payoff methods are recommended for people who are not sure about getting started. It is to be kept in mind that saving money and paying down at the same time is possible.

Maxing Out Retirement Savings

401K and individual retirement accounts are best options for retirement planning and the power of compounding helps us to make small amounts of money into big amounts of money. Why can’t you consider a target date fund or robo advisor that manages a custom portfolio of funds based on the number of years until our retirement?

Staying Diversified

Wealth can be protected by having a diversified portfolio with different types of investments and it has been pointed out that a diversified portfolio includes a mixture of assets that don’t necessarily move in the same direction. Staying diversified is important to reducing volatility over time.

The perfect opportunity to building wealth starts with living comfortably on our current salary and receiving an increase. Employees can consider taking up a side hustle or creating passive income through ways like blogging, Kindle publishing and affiliate marketing. Building wealth from nothing requires taking a deep look at our current situation and our spending and income for several years should be evaluated before building wealth from nothing.

Best books on building wealth help us become financially smarter and they are rich in practical advice, relevant information and inspiring stories. Some of the best books on wealth include Rich Dad Poor Dad by Robert T Kiyosaki, Money: Master the Game by Tony Robbins, The Barefoot Investor by Scott Pape, The One Page Financial Plan by Carl Richards, and The Intelligent Investor by Benjamin Graham.

Rich Dad Poor Dad by Robert T Kiyosaki

Rich Dad Poor Dad by Robert T Kiyosaki depicts the story of a boy with two fathers: one rich and one poor. It focuses on developing the mindset and financial knowledge we need to build a life of richness, exuberance, luxuriance, wealth and freedom. “The main reason that over 90 percent of the American public struggles financially is because they plan not to lose. They don’t play to win”, says Robert T Kiyosaki. The all time personal finance best seller is based partially on Robert T Kiyosaki’s life, who learned different ways of handling money from his dad and best friend. Rich Dad Poor Dad concentrates on accounting, budgeting, investing and managing money. It teaches investors to use their money to acquire assets, managing risks instead of avoiding them and working to learn.

Money: Master the Game by Tony Robbins

Money: Master the Game by Tony Robbins describes seven simple steps to financial freedom, based on the advice of investors who are rich among the rich. It includes everything like mindset changes, saving tips and asset allocation. “You either master money, or on some level, money masters you”, is the favourite quote of Tony Robbins. The transcripts of the interviews are really worth the price of book and it advises investors not to underestimate the power of compound interest. Money: Master the Game tells us that financial freedom including basic expenses, basic + fun, and financial independence is within our reach.

The Barefoot Investor by Scott Pape

The Barefoot Investor tells the story of an Australian boy who took charge of personal finances with a simple system to eradicate debt, live in the present and retire in peace. “You can continue living in the past, beating yourself up about the money mistakes you made when you were younger, telling yourself you have left it too late….or you can rise up and make yourself proud”, says Scott Pape, the author of the Barefoot Investor. Scott Pape is Australia’s renowned personal finance expert with illustrious legacy and impeccable credentials. His book has sold more than one million copies and it makes use of simple life as a metaphor for managing money. Planting, growing and harvesting money has become quite simple with the release of The Barefoot Investor by Scott Pape.

The One Page Financial Plan by Carl Richards

The One Page Financial Plan by Carl Richards makes financial planning very easy and it is an ultimate guide on managing personal finances. It advises investors to turn budgeting into a game to make saving fun and paying off debt as an investment for future. Carl Richards is an influential  financial writer and his book helps people to develop a simple and actionable plan. The One Page Financial Plan by Carl Richards was well received and Carl Richards is a certified financial planner who gives precious financial advice. It is an excellent book for understanding financial planning and the book’s conversational tone is loved by readers.

The Intelligent Investor by Benjamin Graham

The Intelligent Investor by Benjamin Graham elaborates value investing, which is focused on generating steady and long term profits. “Those who do not remember the past are condemned to repeat it”’, says the book’s author Benjamin Graham. The Intelligent Investor by Benjamin Graham is one of the best books on investing ever written. It has been regarded as a true and timeless classic on personal finance. According to Benjamin Graham, there are three principles to intelligent investing, analyze for the long term, protecting ourselves from losses, and not going for crazy profits.