1. Earn
2. Save
3. Invest
In my previous article, I talked about the three types of income. One of them is earned income. And earned income comes from a source. So, how to determine what source to go for? Do the SWOT analysis. Are you best at writing? Do you like persuading and leading people? Are you a finance grad? Is the sales niche good enough to enter into? All these sorts of questions will clarify if you want to go for a certain kind of career or not. Yes, that’s the word: career. Your career provides you with the earned income.
Next, what to do with the earned income? SAVE it. Time will never come back and something WASTED can be hardly be retrieved, when we are talking about something as precious as money. If you think you lose this month and you gain the other month, just imagine what it will amount to if you were to gain in both the months. It is all about maximizing your gains! Figure out what your wants and needs are. Cut on your desires and fix in your needs with the most cost effective methods possible. One of the best ways to save is to contribute to the employer’s plans.
But will saving do it all. No, you have to rework part of your savings for more returns on them. You have to INVEST them. Build up a portfolio for yourself. Here is what Warren Buffet, the investing king, has to say to you, ‘Whatever you do, DON’T LOSE MONEY‘. Try to figure out what the risk to returns ratio is, the time horizon, your earned income, amount of savings, taxation rules, liquidity provision and so forth. If you can’t reckon them all out, you can get some financial advisor to do it for you. If you have time on your side, you can go for more risk.
Remember, no calculated risks, no possible gains.
It’s that easy after all, building wealth.
by Ronny C.
NOTE: If you want to build wealth the way I do, check HERE
About the Author
Ronny C. – A kick-ass internet affiliate marketer…with an avid ardor in Human Psychology.
