Many people feel that living a prosperous life is out of their reach. They dream of joining the 1 percent. While the cost of living and home prices have increased, wages have remained stagnant. It may seem like the average American cannot hope to achieve wealth in their lifetime.
However, there are concrete strategies that anyone can employ in order to foster not only financial health, but real wealth. Issac Qureshi, a taxation and wealth management specialist, shares these strategies and explains how they can solidify your financial future.
1. Start with Your Education
In order to build future wealth, it is very important that you invest in your education. Do a survey of the most profitable fields for someone with your skill level and do everything you can to enter that field. People with college degrees make over a million dollars more during their lifetime than people who did not go to college.
However, you don’t have to break the bank to get a quality education. State schools will provide just as many opportunities as private colleges, and they will not come with the steep cost of student debt that many private college students incur. It’s also worth considering that a college education is not the only path to education. Many of the most successful entrepreneurs have been college dropouts, largely due to their insatiable hunger for knowledge and drive to succeed.
2. Invest Young
It is never too early to start investing for retirement. Starting when you have just graduated from college is the wisest bet. If you put only a few thousand dollars into a retirement account when you are working at your first job, this money will have forty years to grow into a sizeable sum.
It is also smart to take advantage of a company 401(k) program, especially if your employer offers matching funds. Contributing the maximum amount to a 401(k) is a wise decision.
3. Make Savings Automatic
Making savings automatic can keep you from spending your money on unimportant things. Diverting your money directly into a savings or money market account will help you apportion your savings properly.
With this money, you will be able to build a cash nest egg or make other forms of investment like real estate.
4. Live Below Your Means
Young people frequently make the mistake of overspending and relying on credit cards. They may get new cars and live in expensive apartments.
While you are just starting out, it is wise to downsize your costs as much as possible. Restrict unnecessary purchases. Drive a car that is fully paid for. In some cases, buying an inexpensive car with cash is a risky investment because the car may have more mechanical problems, but you will need to look at the risks and benefits before making a decision.
Save on living space whenever possible. Get a roommate or move back in with your parents. Many parents will be understanding of your need to save money and will offer you space for free or in exchange for rent and chores.
Finally, keep your personal spending under control. Thrift shop whenever you can and use consignment shops for your work clothes. These seemingly small changes can help you reap many benefits down the road.
5. Work Hard
It is important that you put as much effort as possible into your job. Even if you believe it is only a placeholder while you are looking for something better, do your best and behave as if you were the CEO. This extra effort will cause you to be noticed and will get you promotions later on.
You never know when you will cross paths with your coworkers down the line. Someone in the next cubicle may end up being your boss 5 years later!
6. Invest Outside the Box
Young investors may be intimidated when it comes to investing in real estate, but it can be an important supplement to other types of investment. Real estate investment trusts or REITs can be a great way for the inexperienced investor to get his or her foot in the door when it comes to real estate. Real estate also shows more consistent returns over time than the stock market.
7. Become an Entrepreneur
Entrepreneurship is a great way to build wealth. Becoming self-employed means that you will keep all of your profits for yourself. Being the CEO of your own business means that you will not be beholden to anyone else’s vision and will give you the freedom you need to begin building wealth.
Keep in mind, as with all potentially rewarding ventures, there is a degree of risk that must be considered.
8. Be Smart with Your Money
When you approach life from a wealth-building standpoint, you will soon see the benefits. Reducing your cost of living, investing in diverse types of properties and businesses, and always putting in as much hard work as possible will help you succeed. Issac Qureshi encourages all young people to become entrepreneurs, building business wealth over the long term.