9 Secrets To Start Building Wealth From Scratch

9 Secrets To Start Building Wealth From Scratch

It doesn’t matter if you’re starting to build a fortune from coins and spare change because the truth is, there are no shortcuts in getting rich. You don’t just wake up one day and get rich; you need to work hard for it. In a study conducted by Ramsay Solutions, the majority of wealthy people took an average of 28 years working, saving and investing before reaching the high net worth category

Are you looking for ways to build your wealth? If so, here are fresh and innovative ideas you can try that include money management tips and micro-business ideas. Not only should you follow these tips but you also need to acquire the right investment attitude, which will help you persevere in turning your dream to reality. 

1. Start saving now

People think that they should start saving once they have regular work with a steady income. However, if you start saving now, despite not yet having a steady income, it will become your habit. Once saving becomes a habit, it will not be hard for you to set aside an amount when you have a steady income. These savings, no matter how small they may be at first, will help you survive on your “rainy days” and will keep you from liquidating your investments for emergencies.

2. Invest your “spare change”

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Investing is one of the sure ways to earn money. However, if you have limited money saved for investments, you can try to invest in “spare change” investment apps, which allows you to start investing with just ₱250. This form of investment is popular with college graduates and younger people who are planning to build wealth at a young age due to its low minimum deposit requirement and simplicity of usage. 

Before submerging into this type of investment, learn its pros and cons to know if this is the right one for you. Besides stocks, crypto or even P2P lending, there are also low initial investment mutual funds offered by some mutual fund companies who are willing to waive the account minimums if you can commit to a monthly investment of between ₱2,500 and ₱5,000.

On the other hand, if you have long-term financial goals, you can set aside your spare change and put them in a jar until you reach the usual initial minimum investment deposit of between ₱20,000 and ₱300,000 on mutual funds or the stock market. The important thing is not to let your savings sit inside your piggy bank or savings account. Make your money work for you by investing it. That way, you can build a fortune out of your spare change at a slow and steady pace.

3. Automate your finances

When you automate your finances, it automatically divides your salary and deposits a certain amount to your other accounts either for savings, emergency funds, bills, and/or investments.  Online investment platforms today allow you to manage your investments easily to automate certain functions.

This way, you will not be tempted to spend your money for bills payment and investments on other stuff you haven’t planned on spending. Every year, you can review your automated plan strategy and try to increase your transfers over time so that you can increase your savings and investment fund.

4. Cut back on your spending

 

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To be able to cut down on your spending, it would be wise to track your finances first. Remember that you are not obliged to spend all the money you earn on things you want just because your salary enables you to do so. Why not make it a goal to spend only 70 to 90 percent or less of your income? You can do this by cutting a portion of your spending on less important things, such as buying overpriced meals in convenient stores when you get hungry in the middle of the night. To save more and build a fortune out of your small income, why not buy snacks in bulk on grocery stores or look for cheaper and healthier ways to satisfy your cravings and hunger? The point is, avoid splurging on things that you don’t need. If you do your best to live simply and below your means, you’re building a fortune in a stress-free way.

5. Pay your debts on time

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Credit cards allow you to spend money you don’t have. While using it can be very helpful, especially on emergencies and other important expenses, you can bury yourself in debt if you’re not careful. If you’re in deep debt, you’ll never get rich.

The lesson: avoid using your credit card except for emergencies and other important expenses. Pay all your bills in advance to avoid accumulating interests and drowning yourself in unnecessary debt. Do not be fooled by “buy now, pay later” promos. The longer you pay for something you owe, the farther you are from achieving financial freedom. Better yet, weigh the pros and cons of credit cards before getting one..

 

6. Get rid of unnecessary stuff

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Aside from cutting back on your expenses, you can save more and build wealth by getting rid of unnecessary things you own. The fewer things you own, the less money you need to spend to maintain them. 

Check the appliances you have at home. Are there things that are just sitting there, and you haven’t actually used for a year? If so, why not sell those stuff and add the money to your savings and investments? You can also lessen your electricity bill by doing so and make your home more spacious.

7. Invest in yourself

Another way you can get rich is by investing in yourself. You can get financial education or seek the help of a professional financial company that will help you understand how to manage your finances wisely and achieve your long-term financial goals such as building wealth from your modest income.

Another way you can invest in yourself is by studying and learning new things and skills that you can use to get freelance work or start your own business. These skills will not only help you earn more money, but it will also boost your self-confidence and overall self-worth.

8. Have multiple streams of income

 

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Inflation in the Philippines has increased in 2020 to 2.9% for the month of January, according to the Philippine Statistics Authority. 

With the constant increase in inflation, holding one regular job will not be enough for you to build a fortune. To keep up with the cost of living and save up for your future, you need to have multiple streams of income.

Aside from taking a part-time job, why not think of business ideas you can start at home? These can include doing jobs that will help you earn passive income such as producing digital products like writing your own ebook, selling advertising on your blog or website, or producing videos on YouTube? If you’re knowledgeable about graphic design and digital art, why not take commissions and earn by practicing your talent? Really, you just have to think of how you can earn from the skills and interests you already have.

9. Surround yourself with people who have similar financial goals

People who share your financial goals will understand the financial decisions you will make. They won’t laugh at you or scold you for cutting back on your expenses or adopting a simpler lifestyle. They will share with you tips on how you can stick to your goal of building wealth without depriving yourself too much. On the other hand, they can also learn from your experiences and sound advice in securing a solid financial future. Really, they’re your financial goals support system.

If you’re planning to build wealth, do not wait for the perfect time to make this a reality; the perfect time may not come. Rather, act now and apply these nine tips so that you can build a fortune with what you have right now.

Author’s bio

Roger Gallager is a Marketing and Sales specialist and a Communicationist. He has written a wide range of articles about money circulation, marketing strategies, business world, real estate, home and community improvement, and mobile technology.

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