The very wealthy are no different from you or me, they just know the secrets to growing their pot of gold. Follow these healthy money habits to a wealthier life:
- You don’t need money to make money: It’s a myth that you need lots of cash to begin with. When it comes to investing, even small amounts of money put into a stock-market fund or a pension product regularly will quietly grow over time. It’s all thanks to the power of compound interest – where you make interest on your interest – which Albert Einstein is said to have called “the eighth wonder of the world”.
Do it now: Set up at least one monthly debit order to put money into long-term investments. History has shown that investments based on stocks and shares do the best. Even if you’re only able to spare R250 a month, thanks to compound interest it will increase. The earlier you start, the better, but even if you’re approaching retirement there is still time to invest.
- Take risks, but educated ones: Clever investors know you won’t make much by putting your money into safe products like savings accounts. In the long term, these can actually lose you money by not keeping up with inflation. The stock market traditionally delivers more than savings accounts.
Do it now: Put aside enough in an easy-access savings account to cover expenses for three to six months, then put as much as possible in stocks and shares. Ask a financial adviser for advice on what medium- to high-risk shares to invest in.
- Work hard: Unless they have inherited it, married it or divorced it, it’s difficult to find a rich person who has not worked their socks off. As Richard Branson says, “You don’t learn to walk by following rules. You learn by doing and by falling over.”
Do it now: Set up support systems. Friends and family can help, but it’s important to network with people in your field, particularly those who could help you go further in your work or your goals. Use LinkedIn to find networks to join. Meetup.com has special-interest groups everywhere, covering everything from running a start-up to industry-specific gatherings.
Read other interesting blog articles here: Reach your financial goals by training your brain or Iemas Financial Services looks at the impact of low or negative economic growth and how to cope financially during these trying economic times.
For more financial tips and advice follow Iemas’ social media platforms or visit our Financial Wellness Tips section on our home page www.iemasfinacialservices.co.za.
Adapted from: http://www.goodhousekeeping.co.za/your-life/3-secrets-rich-people-know/