Learn how to build wealth surely today. A step by step guide in creating wealth and tips on how to stay wealthy.
Want to know how to build wealth? It takes time to build wealth. Most rich people accumulate wealth for about a decade or two. Smart people know how to increase their income and slowly creating huge wealth by not buying the things they don’t really need. Some people are curious why they aren’t wealthy. They work hard and ask their selves why despite of working hard they remain poor. Follow the step by step guide on how to build wealth today. After you read this guide that consist 2,008 words, take action. See on the last section of this page the effects of “not taking action”.
Of course you have to know first what you really want in life. Knowing what you really want is the first steps to become rich. In this guide on how to become wealthy, there is a particular step that will help you know what you really want.
How to Build Wealth 13 Effective Steps
I hope you will like this semi-detailed post with pictures. I know this is effective because I observe wealthy people have in common. This is what we are going to talk about right now. How rich people become wealthy and how can you build your own wealth, too.
A. Building Wealth Will Start by Setting Plans and Goals
Step1. Write a Written Plan
Start writing your plan in a piece of paper or in your favorite notebook. You can also use your computer and type and print your plan and goals. In your written plan, specify how much money you really need to consider yourself wealthy. Write the specific amount and indicate when should you acquire that amount.
Step 2. Put Your Written Plan in the Wall
Put your written plan and goals in the wall or any part of your house. Make it always visible to your eyes. Your written plan and goals will remind you that you have to do something to make it happen. This will serve as a great reminder.
Step 3. Create a Dream Board to Attract Wealth
Manifesting wealth is easy. Create a dream board. How to create a dream board? Get an illustration board. Cut pictures on the magazines or news paper or print any pictures from the internet. Find pictures related to your dream. Do you dream to have a luxury car? A mansion? A luxurious lifestyle? A financial freedom? A successful business? Put them all in your dream board.
If you will create a dream board, that means you are manifesting wealth. If you don’t know what you really want, you can’t create a dream board. And if you don’t know what you really want, you will never become wealthy. So, manifest and attract wealth now!
Step 4. Tell Your Friends or Loved Ones that You Want to Become Wealthy
You have to tell your friends and loved ones about your plans. The reasons why you have to tell them is because they might be the instruments to help you get rich like giving you courage, helping you financially like lending you some business capitals and they can give you a proper advice.
B. Build Wealth by Asking for Proper Advice
Step 5. Be Educated, Ask Wealthy People
Find someone who is already wealthy. Don’t ask for advice to any person. Talk to the right person and you will get the right advice. As the old saying goes, “if you want to know how to climb Mt. Everest, ask a person who’s been there before”. They know the roads and what to do when you’re in the middle of the journey and what to do when you reach the top of the mountain.
Learn and grow by attending seminars. Educate yourself about financial education, investing and businesses. Wealthy people continue learning and growing. Don’t say you know everything. You don’t know everything. The evidence of that statement is your financial situation today. If you are willing to know everything, you will get rewarded for it later. Take time to educate yourself.
Step 6. Find a Role Model (Wealthy Individual)
If you want to get wealthy, do what wealthy people do. How to know what wealthy people are doing? By making someone (wealthy) a good role model. Analyze and observe how did he spend his time everyday. Do you know a friend who is already wealthy? Your neighbor? Be friend with him or her. The idea is to have a guide. His mindset, his behavior and attitude should be your guide. I know you already read the book of Robert T. Kiyosaki “Rich Dad, Poor Dad”. Who’s the good role model? The educated man but poor dad or the rich dad?
C. Build Wealth through Smart Work or Hard Work
Step 7. Increase Your Income
If you want to get wealthy, you need to have different source of income. But beware of this tip. I know a lot of people who became so wealthy by only focusing on one thing. You better find out how to increase your income. There are many ways to increase your income. This can be done through;
Jobs promotion – ask for a salary raise.
Home based business – sell something to your neighbors.
Earn money on the internet – be a virtual assistant, website developer, a freelancer.
The reasons why I want you to become beware of this tips is because it is proven that wealthy people are “focused” individual. They don’t stop trying to make things work. What do you think about McDonald’s owner? Did he stop trying? No. Did he change his niche or product? No. He just become so “focused” and along the way, the owner proves what’s working and what’s not. As a bonus tip, focus only on one thing at a time. When you become successful in one thing, try another thing (business) until you acquire more wealth.
Let’s say you want to become wealthy through investing in stocks. Focus yourself in investing in stocks until you become a successful stock market investor. If you want to build wealth real estate, then focus on “real estate”. The idea is “focus on one thing at a time”.
D. Build Wealth through Proper Wealth Management
Step 8. Manage Your Income
Getting wealthy is not a matter of chance. You have to know how to manage every money you earned. When you received your income (net pay from your salary), or extra income, you need to manage it properly.
Start by budgeting, careful spending and generous giving. The best way to manage money is to divide your income; 20% savings, 50% necessities and 30% for other things. It would be effective if you will “pay yourself first”. What does pay yourself first mean? You need to save money before you spend money. In the other word, don’t save money on what is left after spending.
The biggest percentage you can put your savings, the early you become wealthy. Here are some of the examples;
Savings (Retirement Funds, Investment Funds): 20%
Necessities (Food, Electricity, Education, Shelter, etc.): 70%
Other (Giving, Donations, Leisure, Etc.): 10%
Savings (Retirement Funds, Investment Funds): 40%
Necessities (Food, Electricity, Education, Shelter, etc.): 50%
Other (Giving, Donations, Leisure, Etc.): 10%
Savings (Retirement Funds, Investment Funds): 50%
Necessities (Food, Electricity, Education, Shelter, etc.): 45%
Other (Giving, Donations, Leisure, Etc.): 5%
Hints: Rich people know how to earn money, handle money and manage money properly. Poor people just know how to earn but they don’t know how to manage their earnings.
E. Build Wealth by Investing Money
Step 9. Buy Income Generating Assets
There are many types of investments you can try. Investments are also called “income generating assets”. The idea is to “spend money to make money”. You can invest money in paper assets like stocks, mutual funds, bonds or certificate of deposits. You can also build your own business or buy a real estate property. Those investments can help you make more money.
If you will keep on spending money on the things that depreciate value, you will never become wealthy. Start buying things that appreciate value such as stocks, mutual fund shares, bonds, and real estate property.
Step 10. Allocate Your Assets
What does “asset allocation” mean? Asset allocation is the way on how you should distribute your assets according to your age and risk tolerance. Wealthy people take advantage of “high risks types of investments”, that’s why they become so wealthy. However, they don’t just take high risks, they analyze and manage risks as well.
I have several articles about asset allocation. If your age is 20, 30, 40, 55 or even 60, you better carefully put your money in different types of investments. That process is called “diversification”. I know you are familiar with this famous line; “Do not put all your eggs in one basket”.
Step 11.Take Advantage of Leveraging
If you want to build wealth fast, use leveraging. Leveraging is the process of using other peoples’ money and other peoples’ time to make money. If you want to make big things done, hire people. If you have no business capital and want to start your own business, borrow money in the bank. Many wealthy people know how to leverage.
F. Build Wealth through Compound Interest Effect
Step 12. Take Advantage of Compound Interest
Compound interest is your financial ally. Compound interest can help you accumulate wealth faster. How do compound interest work? Simple, just reinvest the profits to gain more profits. Say for example, if you have $100,000 that earns 10% per year, that means you are earning $10,000 per year. If you will add your profit ($10,000) to your capital ($100,000), you will have a total of $110,000 the following year. The idea is simple. Instead of making just $10,000 per year, why not earn $10,100 and even more. See the difference?
G. How to Build Wealth? Just Work for It
Step 13. Take Action Immediately
Don’t just dream. Dream big. Don’t just dream big. Make your dream a reality. Take action now. Wake up. Do the necessary things. Make everything in order. Do not procrastinate. Do not delay your investments.
Most people become wealthy because they didn’t waste their time. They grab every opportunity. This doesn’t mean you have to spend 23.5 hours a day just to become wealthy. You need to spend your time wisely. Be productive.
Tips and Warnings
I have read topics on how to build wealth. Some are on books, magazines, blogs like InvestmentTotal.com and forums. I also heard this topic in seminars. One thing I can say, building wealth is easy. But, staying wealthy is difficult.
Don’t forget to create your dream board. It sounds “weird”, but it’s effective. Dream board can help you focus on what you want (to become wealthy). It serves as a great reminder that you have to do something. Dream board can help you analyze yourself whether you are just wasting your time or not. If one of the things you put in your dream board became real, that means you are not wasting your time.
One important tip I can share is; you should know how to become patient. Practice patience. Be warned that there are many “get rich quick schemes” nowadays bombarding the internet, classified ads and even TV commercials. Be smart enough to spot the financial investment scam. Prefer to get rich slowly but surely. If you find a formula on how to get rich fast and surely, tell me. I will thank you for that.
It is true that millions are started from cents. What are you doing with your coins? Did you manage them? Did you treat them as “money” or “nothing”? According to T. Harv Eker in his “secrets of the millionaire mind” book, he stated that “you won’t get more until you show how to handle less”. Managing your money is the secret.
Celebrate in every achievement you made. If you earned your first millions, celebrate and be grateful. You have to be grateful everyday if you want to attract wealth. Be grateful to your income, to your investments, to your knowledge. Always thank God because He still gave you the chance to live life.
When you did it, stay simple and humble. Practice humility. The richest men in the world are simple. Take a look at Bill Gates and Warren Buffett. They don’t even become boastful and say “I am rich because I am genius”. They give wealth to society through their foundations or charity. The lesson is simple, what is your plan when you become rich? Will you give money to needy or will you become greedy? Since you are so wealthy, will you support the companies that are destroying the environment? If that happens, you are not familiar with “socially responsible investing”.
It is important that you should not only know how to build wealth, accumulate it through investing. The most important thing is how to make sure that you will remain wealthy when you get there. As I have said awhile ago, asking proper advice to the right person is important. Don’t just climb Mt. Everest, find out what to do when you reached the top. If you find this guide on how to build wealth useful, share it with your friends.