Who wants yo be a Millionaire? Many people who don’t have “enough” will say, yes, in answer to this question. Steve Martin the comedian was once a guest on Saturday Night Live. He answered the age-old question “How can I be a millionaire?” His answer was fairly simple and straightforward, “First… get a million dollars.”
Very funny, Mr. Martin. He performed an extraordinary feat of oversimplification that night. I’m going to give you a little more detail on what can be a complex subject but becoming a millionaire isn’t nearly as difficult as everyone makes it out to be. With a simple three-step process, the keys to the millionaire’s club are available to anyone willing to reach out and grab them. What I’m outlining here is not the only way – just a very simple way forward that most people can accomplish. There are faster ways but they take more skill. By that I don’t mean appearing on the TV show by the same name “Who wants to be a millionaire” which is similar to a Lotto strategy. I mean financially educate yourself – learn how the “system” works and the way will become obvious.
What I have noticed with people who are interested in spirituality – they are not interested in money or wealth. This is fine but eventually many of them come to understand that money is only energy and it’s essential to function in the modern world. Putting some attention on your abundance and future wealth is not only important but I would suggest, as I have done in many other articles, that if you are not abundant you are missing something spiritually. The energy of “lack” is dragging your consciousness down. Having said that, it’s also important to understand that the physical energy of money is the result of physical creation. It’s a rare soul that can look out through a window and make it rain in 100 dollar bills. Many people who are interested in spirituality don’t have the basics skills to increase their wealth.
Before you begin any financial strategy, you must know that there is a huge difference between what you earn, what you own, and what you’re worth. The amount of money that you earn from going to work everyday is known as your income, and is only relevant in helping you build wealth. The sum of the value of all of your possessions is known as your wealth, and is a closer guideline. Net worth is the real gauge of how close you are to becoming a millionaire, as it is the value of all of your assets, with your total debt subtracted.
If you answered yes to the question, who wants to be a millionaire then here is where you need to start. The first phase in your journey involves understanding that time is of the essence. For those who start investing at an early age, the power of compound interest or compounding returns makes time your greatest ally in wealth-building. Once you have been investing for long enough, your investments will begin to consistently, and eventually rather impressively, outperform your paycheck.
This is true no matter what level of income you have already achieved. If you have an annual salary of $50,000, and invest only 10 percent of that each year, earning a 10% annual rate of return on your investment, in 25 years you will have amassed over half a million dollars. At this point you will be earning over $50,000 each year in interest. Continue saving at that rate for another 10 years and you will find yourself earning $150,000 annually in interest. 10 percent of your income may seem like a lot, but if you can find an investment which directly debits the money from your paycheck each week, you will be surprised to find yourself able to live without it.
Owning A Home
Owning a home is the single largest investment that most people will make in their lifetime, and that is why moving from renter to home owner is your next step on the road to becoming a millionaire. The growth in the value of real estate in this country makes owning a home not only a wise investment, but also a hedge against inflation While many pour their money into renting a house, effectively flushing it down a toilet they don’t even own, you should be using yours to cover the mortgage payment of the most profitable purchase you’ll ever make according to some financial experts.
While it’s true that owning a home does come with certain expenses which a landlord normally covers for those who rent, in some countries like the USA the tax advantages which you receive for paying the interest on your home loan help to offset your out of pocket expenses. This can also be arranged in other countries for your personal home via trusts.
Invest Don’t Waste
The final step in your quest to become a millionaire is to make sure that as much of the money you earn as possible is there for you to invest. That means giving as little as possible to others in the form of taxation and spending. There are many legal ways to reduce taxation. This can be done through certain types of investments, time periods for those investments and the legal structures that you control and own your investments through.
Many people just plain and simply spend too much money. They are continually buying things that seem either unnecessary or frivolous. Of course this is subjective and we each have our own lives to live and desire to fulfil. The point is that if you look at where you spend your money and on what, I’m sure you will be able to funnel it wisely toward increasing your wealth.
One of the worst ways to progress is through a traditional savings account. As an investment this is one of the worst vehicles available. Along with the comparatively low rates of interest which savings accounts earn, any money that you do earn is subject to annual taxation.
What You Do Is Up To You
Of course this is not financial advice I’ve merely shown you three easy steps that you can investigate further. You answered “yes” to the question, who wants to be a millionaire and to reach this goal requires action. We are each individuals that have different circumstances, for example I like business and therefore earn and invest through business. I have expanded on the three steps above and employ a slightly more complex method therefore my requirements are different to yours. Use your common sense and educate yourself. Just make a start!
How is your wealth building strategy progressing? Comment below or join me and comment on Facebook