Making and managing your money is an ongoing process of embracing professionalism. It’s self-leadership in the money arena and could involve you becoming your own virtual financial planner, or farming out the work to a professional. Either way, it has to be done to seriously build wealth.
Let me tell you a true story. Anne Scheiber lived on social security in New York in an old apartment for $400 a month. She had been an IRS employee — that’s the tax office in the USA. Everyone thought she was poor but when she died at 101 years of age, she left the Yeshiva University $22 million! How come?
When she retired from the IRS in 1943 she had $5000 in savings, which she put into quality stocks and she kept them, re-invested the dividends and kept building her wealth.
She committed to the Law of Process, where she had a plan to build wealth — it was a good one — and she stuck to it. And how!How do you become wealthy?
The building blocks of making and managing money can be put down to a simple process that most people can’t stick to, and that’s why they find it hard to build wealth.
You start with goals — such as $1 million in your super fund, a house paid off and a rental property. You then work out how much you have to save each week to invest to make it happen and this gives you a savings target. To find the money, you have to do a budget to see what income you have and how you spend it. If the budget shows you that you’re not making your savings target, then you have to get more income or cut your expenses.How do you save?
You might have to get a second or a better job or try to cut your spending by say 10 per cent. You might become a smarter shopper and this could deliver the savings.
Once you have the savings target mastered, you then need the plan. This plan could be constructed by a professional financial adviser or you could do it yourself — just like Anne Scheiber.
If you’re not an expert in investment matters, I’d recommend finding an accountant to help you with tax issues that could help you achieve your goals. Then find a financial planner for the investment strategy. A good stockbroker could also help or you could read and do plenty of research to construct your own plan.Never give up
Too many people think it’s all too hard and won’t pay for help and so nothing happens — this is false economy. If the goals are important, such as sending your kids to private schools, looking after your family to a standard you want or just being able to retire early, then you have to get a plan and be committed to it.
There are many ways to build wealth — buying income-paying stocks, accumulating great rental properties, borrowing and using the tax system and a whole lot more, but the first step is to think up the goals and then move to get a plan in place.
You don’t grow wealth in a day but daily!Tips for making and managing your money
1. Have wealth goals.
2. Plan to build wealth so write down your goals.
3. Do a budget and be committed to sticking to it.
4. Start saving.
5. Consider seeing a financial advisor – if not now because you don’t feel you have enough money yet, put it down as a goal for later.
6. Never give up! If you have a choice between being rich or poor, choose rich because it’s better!