We all want to find ways to create wealth because no one wants to live paycheck to paycheck. Generational wealth is also very sought after. It has been created over time using some simple, yet unique tactics. Most people want to make sure they can make their money grow over time to support the next generations to come. That’s understandable.
However, in these moments it’s hard to see how you could be able to find ways to create wealth for generations, let alone yourself. But did you know that now more than ever is the best time to build your income? Let’s take a look at some ways to create wealth during these uncertain times.
1) Pay Off High-Interest Debt
If you are trying to implement any strategy to reach wealth, you will first need to tackle your debt.
You don’t want to start investing your money elsewhere until you take care of your high-interest debt. In order to pay off debt effectively, high-interest rate debt should be the first on the chopping block (like credit cards for sure!). Credit card interest can have the highest interest rate, often over 10%!
So how can you rid yourself of high-interest rate debt?
Well, consider asking for a lower interest rate. More often than not, if your credit is in good standing, asking for a lower interest rate on your credit card can be done.
If your credit isn’t quite there yet, you can always do a balance transfer. A balance transfer card can allow you to transfer your high APR to a new account with little to no interest intro period. It could help you pay down your high-interest debt.
While you pay down that debt, make sure you don’t incur any more debt, especially any with high-interest.
So, you should:
- hide your credit cards – don’t use them unless it’s absolutely necessary
- know what you owe
- and have a small $1,000 emergency fund
Once you have your high-interest rate debt taken care of, you could start investing your money to build your wealth.
Related: 10 Extreme Ways to Pay Down Debt
2) Maximize Your Personal Income
In order to build wealth effectively, you should be investing the income you have to maximize your personal income. Your earning potential is important when creating wealth.
You can increase your earning potential by:
- learning a new skill
- starting a side gig
- asking for a raise
These things can help build up your annual income so that you can start investing a portion of your income in other places. This could help you build your residual income so that you can essentially make money while you sleep.
Have you ever wondered how wealthy people maintain their wealth, yet are able to spend money comfortably? Well, that comes from residual income.
How can you build a residual income?
- Try affiliate marketing
- Create an app
- Write an eBook
- Start a blog
A little investment can go a long way for you to make money. But, make sure you have the income to invest before you take that step.
3) Make a Real Estate Investment
Real estate investing can be very lucrative. However, you must be patient in order to see a real return. This can also contribute to your residual income and raise your net worth, helping you track your wealth.
There are ways for you to invest in different real estate, such as:
- becoming a landlord
- flipping houses
- investing in Real Estate Investment Trading (REITs) or Real Estate Investment Groups (REIG’s)
In either scenario, you will need some type of investment capital in order to get started investing. You may need a substantial amount of investment capital depending on which way you decide to go with your real estate investment.
Becoming a Landlord/ House Flipping
If you’re looking to be more hands-on and you have some renovation skills and/or expertise, becoming a landlord or house flipping might be the right way to go. Maybe you want the investment to be more real estate stock related, then REITs would be a better option. REIG’s is a great option if you want to generate residual income while your real estate appreciates but you don’t want to spend to much time with your hands in the pot.
More Passive Real Estate Investing
If you’re looking to invest in real estate on a larger scale and don’t want to run it yourself, online platforms can be a simpler solution. Sites like Fundrise and Roofstock make it easier for you to invest online with ease while they do the work for you (although Derek isn’t a huge fan of online platforms). You just get to reap the benefits of the return. However, remember real estate investing requires patience to see a real return so don’t expect to win big within the first week.
Either way, be sure to do your research before investing since this will take a large sum of your money and even though the return is important, the risk associated with each can vary.
Related: Top Tips for Real Estate Investors
Your living expenses can include anything from your energy bill to your transportation costs. The goal is to find ways to limit or cut your spending.
Well, you can reduce your living expenses in a number of ways so that you can start to create your wealth. The first step is to make sure you know all the expenses you have by writing them down. Having something tangible to go back to when you forget what all you pay can be very helpful.
Some of the best ways to reduce living costs include:
- cut out subscriptions and club memberships
- cancel your cable bill
- cook more and eat out less
- have a yard sale
It’s important to utilize the method of reducing, reusing, and re-purposing items. It can ultimately help you save money and cut down on your expenses.
Once you have reduced your living expenses, make sure you don’t spend your money frivolously. Cutting your expenses can only be helpful if you don’t continue to spend money on unnecessary items.
In order to stop spending money frivolously, you can:
- Think about your debt — ask yourself “Do I really need this or will it just add to my overall debt?”
- Use cash only — no credit/debit cards, no problem
- Separate your wants from your needs — don’t spend on unnecessary things
They work hand in hand. In order to reduce your living expenses, you will need to cut the areas where you spend the most money. Then, you can focus on really creating your wealth the way you see fit.
5) Build a Cushion
A cushion, or emergency fund, is great when you are able to start saving and investing your money to create your wealth. This cushion is typically set aside to help with emergency events that may pop up. It’s always great to have a plan, especially when money is involved.
However, the unexpected can happen and you will want to make sure you can take care of it. So an emergency cushion should also be a part of your plan to take care of the unexpected needs such as car troubles or necessary renovations for homeowners.
6) Invest in You/Brand
Is there something that you are particularly passionate about? Is it something that may be lucrative? Well, if that is so, make an investment in yourself and your brand. Some of the wealthiest people took a chance on themselves first, which is why they have been so successful.
If you are looking for ways to invest in yourself, you can:
- practice self-care and meditation
- attend networking events
- read more books
- LEARN A NEW SKILL
(Yes, I mentioned learning a new skill in 2 different sections, hence its importance. Lifelong learning is important and adding extra skills to your expertise can really pay off for you.)
There are so many ways to invest in yourself, but, first, you have to get moving and stay focused on the goal of wealth creation for your future.
Top Ways to Create Wealth – It’s Your Turn!
When focusing on wealth creation, you need to have a plan. A plan for your budget, your debt payoff, your spending, and your investments. If you can keep track of where your money is coming in and going out, you can control how well your money grows.
Remember, just as planting a seed and waiting for it to grow requires patience, so does accumulating wealth.
So, have you started building your investments? Are you successfully on the path to creating wealth for generations to come?
AUTHOR LaTia Longuemire
My name is LaTia Longuemire. I enjoy writing, singing, and cooking in my spare time. My passion is helping others. At this stage in my lifetime, I'm primarily focused on my children. They are everything that keeps my world spinning.