I have read a very interesting book about secrets of the rich. That it is through wise management of our personal finances, anybody even payday-to-payday survivors like us-- can grow her wealth. The author of that book who is also an entrepreneur, management consultant and also a financial advisor believes that we can retire from work well off without resorting to high ventures or illegal gambits. He shared the following in achieving financial independence...
- Pay yourself first. The only way to start growing your money is to save some 20% of your salary immediately. To make it easier, think of yourself as a company and compensate yourself first before doing anything else.
- Keep it liquid. Instead of real estate of other hard-to-unload properties consider investing initially in safer money instruments such as government treasury bills and bonds. Here your money stays liquid and earns more than if locked away in a savings account.
- Consider the risks. But if you want to invest big time, know that the bigger the returns, the higher the risk. Playing with stocks is a very dicey move, and franchising and small businesses have a high failure rate. Best option is to spread the risks and find a mentor to guide you.
- Steer clear of dubious pyramid, networking and other get-rich schemes that will only fleece you dry.
- Do not equate wealth wealth with tons of money. The goal is to become wealthy, but in the sense that present financial resources can support your lifestyle over a long period of time, even if you no longer work.
Whatever the case may be, the only way to start growing our money is through prudent saving and investing.