Archive for the 'Wealth Building Tips' Category

Sometimes finding good advice on money and savings is hard, especially on the internet. Everyone and their mother (literally) seems to have advice as to how you can get rich quick, or save a bundle and retire early. Which advice do you take?

I was recently put in touch with a website called Thrifty Scot to check it over and see what I think. All in all, a good site that provides useful knowledge and services for those of you looking to save a little money and increase your wealth.

First off, as we’ve mentioned before, you can stand to save a lot of money in the long run by purchasing a house rather than renting which means taking on a mortgage. Thrifty Scot has some useful information on mortgages that may just help you out of a jam and get the right rate and deal when buying that first home.

Another killer for some peoples wallets is how much they pay in car insurance. You need to pay attention to what the “sales people” are trying to sell you and knowing what you need and don’t need is half the battle. Let this site help you out.

Lastly, once you have your finances in order you may need to get a boost in cashflow and take on some loans. We suggest heading over and learning about a sucured loan before you do anything. It could save you a lot of money in the long run by allowing you to watch out for some of the pitfalls that so often come with taking out a loan for many things.

Most of all, just read, read, read. The more you know about saving money the better chances you have of making more of it and creating wealth for yourself.

The key to success in any venture is planning. Set out on a voyage without a map and adequate supplies and you are bound to fail. Financial planning is similar. If you don’t know where you are going, it’s tough to get there. Sit down tonight and plan your financial future. Where do you want to be a year from now financially? In five years? How about your retirement goals? Factor in the costs of all your dreams and write out a specific plan to get there. How much do you need to invest weekly, monthly, yearly to attain your goals? Make your plan and put it into action–you’ll move closer to your dream of financial freedom.

Make a commitment to changing your thoughts about money. The more you think and speak negative thoughts about money, the worse your financial situation. You attract what you believe. Conduct an experiment over the next few weeks. Pretend that your life is abundant. Believe that you are attracting money and opportunities every day. When you begin to complain about money or debt, replace those thoughts with ones of abundance. Imagine how it would feel to achieve financial freedom. Live these thoughts as well–if you spend each day spending money you don’t have, you are likely to stay poor. You have nothing to lose and everything to gain by simply changing your thoughts and actions towards money.

Here are the biggest mistakes that folks make on the road to wealth. Double check to be sure that you aren’t guilty of any of these poor judgments.

Holding a 30-year Mortgage

If you have a 30-year mortgage, you could spend more than $100,000 extra dollars more than those with a 15-year mortgage.

Letting Someone Else Control Your Money

Know the details of your finances, don’t just turn it over to a broker, financial consultant, or spouse.

Failing to Control Leaks in Spending

Many Americans in debt spend their money in small amounts. If you plan to accumulate wealth, you have to stop leaks in spending.

Failing to Plan

If you don’t know where you are going and have no plan to get there, chances are you’ll never arrive. Write out your goals and visualize them.

Incurring Too Much Debt

If you spend all your money on interest on debts, you have nothing left to save. Pay cash and avoid credit card debt to pave your way to wealth.

Poor Retirement Saving Habits

Start early and save at least 10 to 15% of your income. Start today!

Taking Money From Retirement Funds

If you cash out or borrow money from your 401(k), chances are you’ll never make up the lost retirement savings.

The most solid route to wealth is by acquiring financial knowledge. Everything that you can learn about money aids in your quest for financial independence. The following books are recommended reading on your path:

The McGraw-Hill 36-Hour Course in Accounting by Robert L. Dixon and Harold E. Arnett

Own Your Own Corporation by Garrett Sutton

Courage to Be Rich by Suze Orman

The Millionaire Next Door by Thomas Stanley

Guerilla Marketing by Jay Conrad Levinson

More Wealth Without Risk by Charles J. Givens

CNN features a terrific article on teaching your kids the value of a dollar and a whole lot more. They remind us that children learn about money by watching us every day. Be sure to take this opportunity to model the right lessons for your child’s financial future.

Here’s a quick summary:

1. Don’t say “We can’t afford it”

Use the right language to teach your child about money. Help your children learn that they have choices about how to use the money they have. Use an allowance to help your child understand the concepts of spending and saving.

2. Show them the money

Use cash as much as possible and educate them on credit cards if and when you use them. Talk with them about your checking and savings account balances as well as any credit card balances or outstanding loans. Let them help you make payments and do simple bookkeeping.

3. Talk about how much things cost

Discuss today’s expenses with your child as they occur. Give your child ideas about money that they can understand, relating costs to values they can grasp. Children pick up a lot about finance just by discussing it regularly.

4. Buy something that isn’t on your list

Sometimes we need to be flexible and buy things off the list. Being smart with money can also mean spending wisely, taking advantage of a sale or capitalizing on an unplanned opportunity.

5. Be open with your spouse about money

Some partners hide spending to avoid criticism from the spouse. Kids learn distrust from this and that money is a secretive topic even within one’s own family. Take steps to foster the right kind of attitude about money in your child.

Here’s the entire article.

CNN Money offers a few great ideas for making the most of your tax return. Instead of running out and spending the money, invest in one of these ideas and watch that extra money grow.

1. Contribute to your IRA

2. Contribute to your 529

3. Open a CD

4. Add the money to your emergency fund

5. Pay down your credit card debt

Visit CNN Money for further information about these ideas.

Google offers a tax refund calculator to help you see how this could add up.

The best perspective on wealth comes from a stand-up comedian. When a panhandler asks him for change with the line, “Hey, buddy, I’m broke. Can you spare anything?”, the comedian responds, “Broke? Listen, I’M broke. I’M $700,000 in debt. You’re EVEN!!”

If you want to be wealthy, you may need to redefine your concept of wealth. Do you think wealth means living in a huge house? Most millionaires don’t, because it means thousands of dollars beyond the mortgage and associated expenses to maintain this lifestyle. Debt is the opposite of wealth.

Do you think it means driving (and maintaining) an expensive car? Expensive clothes? Expensive upkeep on just about everything? This thinking is not in keeping with many millionaires’ priorities.

If you want to be wealthy and you have not read The Millionaire Next Door yet, make it the next book you read. It may change your mind about wealth and how to go about amassing it. Remember, changing your mind is still free.

Do one thing to increase your wealth today. Even if it is simply clipping a coupon for something on which you will later spend money, find a way to end the day with more than you had. Did you know that on average, first-generation millionaires spend twice as many hours each month on financial planning as those with fewer than average assets? Maybe you need to spend an hour coming up with a financial plan for your life. Perhaps you’ve been meaning to take time to set up an auto investment. Consider selling unwanted possessions online or via newspaper classifieds. Once you decide to increase your wealth, the possibilities are endless.

In assessing value, don’t overlook enjoyment. If you collect junk, well, the value is inherent in it’s name–junk. But if you collect something of value with purpose, your passion can pay off. Perhaps not in dollars, but in friendships, acquaintances, barters, giveaways, and plain fun. For example, collecting stamps, coins, rare books, art, or furniture as a hobby has a value attached, both monetary and ethereal. Consider this investment when deciding how to spend your time and money. Remember, too, that simply collecting money can be a pleasure unto itself in the peace of mind it brings. On the opposite side of the coin, collecting debts has little value.