Absolutely not! You don’t need to be smart or have well-placed connections to create extra income streams. All you need is the willingness to learn about your options and the time and money to pursue them.
If there was sure-fire way to become rich, I’d be writing this article from an island retreat, while sipping on cocktails. But, I’m doing a few things (and seeing results) to increase my chances of accumulating wealth that I’d like to share with you:
Investing can be intimidating. However, according to the 2013 Forbes Billionaires List, most billionaires made their wealth through investments. It could be real estate or stocks but, investments don’t just give you an opportunity to make money, they also help you generate passive income. If you know of other proven ways to make money than investing, give them a shot.
2. Start Now
If you procrastinate, you’ll never start. So, start saving and investing to earn interest. Just ensure that the interest is compounding because that’s what will make your money grow. You see, the interest you earn also earns interest, and this can make thousands — or even millions over a period of time. Therefore, the earlier you start to put your money to work, the more work it will do for you.
3. Work Hard
Starting now also means you should start working early and hard too. The wealthy have skills but also work very, very hard to develop them. In fact, Wall Street Journal writer Rob Frank cites a study noting that people who earn over $100,000 a year spend less than a fifth of their time on leisure.
4. Stop spending too much
Yes, money is a tool that helps us do things that bring us happiness. That’s why you should spend A LITTLE! Every cent you spend is money that you could have put to work earning that sweet compound interest. So, if you’re serious about accumulating wealthy, keep the magic of compound interest at the back of your mind.
5. Spend less and stay frugal
Frugality is about spending money on things that really matter to you. I’m taking about simple things like making your own coffee instead of buying it from a coffee shop. When you look at extravagant displays of wealth, you might want to jump onto the band wagon. However, many of the world’s wealthiest people are frugal. The founder of Ikea takes the bus. Warren Buffett has lived in the same five-bedroom house since 1958.
The aim is not to make you extremely frugality, where you start to ration out your toilet paper. The aim of being frugal is to maintain a sane relationship with money. Use your money to do some things that make you happy but, don’t spend it all.
To be rich or just comfortable?
What most of us really want are the things that money can buy us — interesting experiences, flexibility, freedom and security. The truth is, you don’t need to be rich to get these things. What you need is planning, balance and goals.