Here are five super wealth-building tips for the success-minded individual...
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There are so many things involved with building
wealth that it would take much more than one
article to explain it all. So, we've put together a
simple five-step guide to help you get a great start
in building wealth for a lifetime.
Step 1: Set Specific Goals
Goal setting is a task that can be easily put off -
especially when you are extremely busy in day-to-
day activities. However, goal setting is the first and
one of the most important steps you'll take to
achieve wealth. Set both short-term and long-term
goals. Short-term goals may be daily, weekly and
monthly goals. These should reveal where you
would like to be financially by a certain time in the
near future.
Long-term goals include the amount of wealth you
would like to accumulate within a year, two years,
or maybe even five or ten years. Both types of
goals are necessary to build wealth. Without goals,
you are wondering blindly with no care or thought
of what's ahead. This pattern of life is sure to leave
you empty-handed!
Step 2: Create a Business Plan
Every successful business from the past and today
started with a plan. Your business plan should
illustrate where you are now, where you plan to be
in the future, and how you're going to get there.
Write these few notes down on paper. Then, fill in
the blanks to create a rough business plan. It's
easier than you think.
*Your current income
*Business profits and expenses (if you already own a business)
*Business budget (or personal budget if working for someone else)
*Capital needed upfront to promote and operate business
*Plans to acquire the capital needed (source of capital)
*Spending plan (promotions, supplies, inventory, online expenses, etc.)
*Expectations (What results do you expect from your initial efforts?)
Creating a business plan is a necessary step to build
wealth through your own business. Even if you
don't own a business, you should write down a
similar plan to reach your personal wealth goals.
Step 3: Avoid Harmful Debt
Debt is the one of the key reasons many people
never accumulate wealth. But remember, there are
two types of debt: harmful debt and necessary
debt. Harmful debt is the debt you create for things
you do not need such as excessive shopping,
luxury items, expensive cars that you can't afford,
etc. Necessary debt is a debt most people must
have to live, such as a mortgage, car loan
(affordable), medical, college, etc. These debts are
a part of life for most families and will be for
many, many years. However, even these types of
debts should be kept well within your income
limitations. If you can only afford a $250/month
car loan, then shop around until you find one at
this price. Don't give in to the temptations and
pressures to buy the fancier, more expensive car
with a $450/month payment. It's not worth the
risk!
You may ask, "I thought these steps were for building wealth?"
As it happens, debt is the opposite of wealth. The
more debt you have, the less wealth you will
accumulate. You can't save money or invest money
that belongs to someone else. If you earn $3,000 in
income this month, but owe $2,000 in loans
(before everyday living expenses), you can't
possibly have extra money to save. You must
either earn more or sell some items to pay off your
debt. You should avoid this "debt trap" if you
intend on building wealth for the future.
Another type of debt is one for your business. You
may take out a small business loan to get things
started or to promote your business. If you are
uncertain about whether the business will bring
profits, try to avoid business debt until you have
tested it a while.
Step 4: Develop a Personal Plan
Above, you developed a business plan. Now it's
time to create a personal plan. What tasks will you
do daily to build wealth? Put yourself on a
schedule and a strict budget. Work toward your
goals daily by making a list of things to do and
marking off each item on the list as you complete
the tasks. In your budgeting, include a set amount
of money you will put away in savings (savings
account, IRA, stocks, bonds, etc.) If you plan to
invest, be sure to diversify your investments.
Choose only one or two high-risk investments and
several "safer" investments such as mutual funds
or bonds.
Step 5: Stay focused on the Goal, not the Circumstances
No matter what circumstances you find yourself in,
keep your eyes on the wealth-building goal ahead.
Even if sales are down in your business, don't stop
dead in your tracks. Remember, businesses have
ups and downs. If you remain steadfast toward
your goal during the slow times, the busy times are
bound to be much better than ever. Your income
will grow and you will have the extra money
needed to reach your wealth-building goals.
In a nutshell, building wealth does not happen over
night with one get-rich-quick program. It happens
with consistent labor toward the goals and tasks
you have created. You can build wealth for your
future if you do not waver from these basic truths
that have worked for millions of others!