Tuesday 22 January 2013

how to become rich?

There are many ways to become rich, but many more to become poor. Of course it's usually not easy and many quick methods involve a lot of risk. so take your time and follow these steps to build your wealth.
Note that people have different perceptions of what it means to be rich. In this article we will define rich as having a fortune higher than $1 million.
Steps

Start by investing in your most important asset: Your mind

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Doing well in school and getting an education in a high-paying profession such as doctor, lawyer, economist, banker, etc. will
  1. Learn about basic economics such as compound interest and investment strategies.
  2. 3
    Be intuitive (having a broad base of knowledge including that which seems somehow practical but not necessarily usable at the time helps with this).
  3. 4
    Develop yourself all your life. Increase your professional skills, leadership skills, financial skills, social skills and general life skills. Making yourself valuable will increase your chances regardless of your path to riches, and enable you to derive more utility from any given amount of riches.
  4. 5
    Develop a vision; why should you become wealthy? Based on this, set your goals. You wont rise up unless you are able to build and focus your ambition.
  5. 6
    Stay healthy,a healthy weight. There's a saying that "health is wealth". It is very important to stay healthy in your endeavor to become rich. This will enable you to work hard and also increase your life span increasing your earning and pension-drawing period. On the other hand, you will be able to reduce the cost on health care. You will also have more time to enjoy your money including perhaps through philanthropy in retirement.

Invest

  1. 1
    Start investing as early as possible- learn through your small minimum investments. Consider the cost of the funds lost from not working while in college, as well as, tuition and interest. Do not wait until you have "enough" money to invest. You will end up with a larger account in the end if you start investing a small amount early and keep adding more regularly.
  2. 2
    Make smart investments
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  4. 4
    If you don't understand what you are investing in, invest small or not at all. Start with something easy like index funds. They have fewer ups and downs than individual stocks, and you will not have all your eggs in one basket. "Put all your eggs in one basket, and watch the basket." W Buffett.
  5. 5
    For safety: Stay as debt free as possible. A paid-for education and a paid-off house will enable you to invest more money in the stock market or your own business. Only gear up low-risk investments with loans.
  6. 6
    Starting now is better than never starting. The power of compound interest can make anyone wealthy. Example: Investing only $10 every year at 15 % annual profit will give you over $1.3 million after 70 years.

Start Your Own Business

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    It is always better to be an employer than an employee, if you are disciplined and able to devote time and money. Learn all you can about running a business. Take a class. Ask an experienced business owner for advice. Be careful, though. Many businesses fail, especially in their first year. You could end up with considerable debt, no savings, and no benefits. Get help!
    • You don't need to be the only person in your business to avoid having someone siphon off the profits from the contacts and goodwill you generate. If you can work efficiently with someone with complementary skills who is very honest and reliable, you could start a business as co-owners.
  2. 2
    Entrepreneurs make up the majority of millionaires, it is high risk, but it is also the most likely way to become truly wealthy. Few people amass great wealth through other means. Less than 1% become a millionaire through "other" means such as being a rock star, winning the lottery, etc. So unless you inherit wealth your best shot is doing this.
  3. 3
    Note that you can start your own business part-time. For example by going into real estate, tax sale investing, purchasing, renovating and selling homes is a common way for building wealth for people without money to invest.

Be Smart

  1. 1
    Learn about budgeting, credit, and debt. Learn how credit cards work! If you get into debt early it can sabotage your progress.
  2. 2
    Put an amount of money in the Credit Union monthly. 10, 20, 30 dollars is good - $100 is better. By the time you get old, retirement would be easy. (See segment about compound interest).
  3. 3
    If you are in college and can't afford an apartment and don't like those nasty dorms, then gather with 3 or 4 people, and buy a good sized house while splitting the payment. It'd probably cost less than a apartment. Better yet, buy yourself a home using a mortgage and pay yourself instead someone!
  4. 4
    Listen to your instincts and don't be afraid to go against the flow. If someone tells you that they have found a sure-fire opportunity to make YOU rich, it usually means that they have found a sure-fire opportunity to make THEMSELVES rich by convincing you to buy their product. So stop and think, there are millions of great opportunities out there. You just have to filter out all the background noise to find those opportunities because, in the real world, no one else is going to find them for you.

Protect Your Money

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Various unforeseeable problems can lead to people trying to take your money. Try to protect yourself against them before they happen. Make sure you have adequate liability insurance, and a consult a lawyer about protecting your assets and those you want to put aside for your children from problems that may arise.give you a head-start and a safer economic position.

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