Today’s culture is undoubtedly attracted to the get-rich-quick schemes across the internet. Instead of learning how to build life-long wealth, most people are more concerned with getting rich quick.
The issue in this fallacy is two-fold. First, more often than not getting rich quick never works out. Whether that be due to a lack of motivation to keep hustling for money, or the fact that it simply takes too long. The second issue is that those who do get rich quick often struggle to keep the money.
Building long-term wealth is key to financial success. Better yet, is that money grows exponentially, so what seems slow to start ends up growing drastically when done correctly.
If you’re interested in building lifelong wealth, you’re in the right spot. Here are some of the most important keys to lifelong wealth:
Develop Multiple Income Streams
To the average American, a single stream of income satisfies their needs — it’s all they need to get by on a day-to-day basis. In fact, nearly 80% of all Americans live on a paycheck-to-paycheck basis, meaning they have a single stream of income.
Building wealth on a single stream of income, especially when working for someone else, is near impossible. There are no guarantees in the world — especially financially. While there’s no issue with having a regular job, relying on that single job as your only stream of income is dangerous.
Whether it be the company going out of business, being fired, or a handful of other reasons, there is always potential to lose that single stream of income.
Fortunately, there is an infinite number of ways to build more streams of income. Be it through a side job, starting a business, or investing current capital, the possibilities are endless. While your next stream of income doesn’t need to a million-dollar idea, it should be one that is scalable. Remember — there’s no need to get rich quick but going into any new financial venture should require a plan. Generally, the more scalable the better.
Whatever your next stream — and eventually streams — of revenue are, this is a vital step in building lifelong wealth. This is the same reason that almost half of all millionaires have almost four streams of income.
Multiple streams of income allows you to build wealth exponentially, so make sure you’re working towards more income streams if you’re not already doing so.
Live Below Your Means
Living below your means is perhaps one of the most well-known, but least followed, keys to building lasting wealth. The reason for this is because it’s not as easy as it sounds.
Failure of living below means is the same reason how some of the richest athletes in the world, like Mike Tyson, went broke after they stopped producing money. In fact, this is a perfect example of why it’s so important to have multiple streams of income. Even for those who have a singular high stream of income, if they don’t live below their means, they can and will go broke.
Living below your means requires creating a financial plan. Truthfully, this is more important in the beginning of the wealth beginning process. Ideally, your multiple streams of income will eventually produce enough monthly income to far surpass your needs financially.
However, in the beginning and until your streams of income fully cover your expenses, budgeting is essential. Know the exact amount of money you need to live, at the bare minimum, every month. From there, create a plan as to how you will grow your income and potential large spending you can cut out until you have more money.
Don’t go out of your way to try and save $5 per month if you’re making $10,000 per month, but make sure you’re not vastly overspending anywhere either.
Budgeting plans vary per person and are very situational, so do what works for you. At the very least, know that it is essential to building wealth until your monthly income (from multiple streams) drastically surpasses your expenses.
To build real wealth, investing is necessary. Better yet, this can turn into an extremely legitimate income stream if done correctly. The best way to invest for lifelong wealth, though, is passively.
While there’s nothing wrong with actively investing, be sure to note that it will take time away from building other income streams.
Passively investing in areas like real estate provide great returns and are extremely scalable. Best yet, though, is that once they are operational, they require little work by the investor (you).
Some of the best real estate deals for a passive investor include apartment rentals. The data doesn’t lie, and there are clear increases in renting versus home ownership, as well as increasing rent prices. This allows investors to eventually have less vacancies and charge their tenants more — all the while property appreciates in value.
Apartment rentals are a great passive investing option for building lifelong wealth because once the work is done, the landlord has the ability to hire a property management company to do day-to-day work while they collect rent.
Want to learn more about passively investing in real estate and how it can affect your lifelong wealth? Be sure to listen to the Best Ever Show by Joe Fairless and read the Best Ever Apartment Syndication Book.
Disclaimer: The views and opinions expressed in this blog post are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action.