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Financial Independence • 1046 • 1
Do you have a 9 to 5 job but still struggle to make enough money to live comfortably? Do you want to leave your work to pursue what you love? Then this post is for you. The following actions will enable you to grow your wealth while leading a comfortable lifestyle: -
Regardless of your income level, always set aside a minimum of 10% as savings. It would not have a major impact on your quality of life and enable you to have a backup plan in case of emergency. Additionally, you will not be afraid to leave your 9-5 job and focus on something that you actually love such as a startup or entrepreneurial venture.
Being frugal involves making wise use of your resources such as time, food or money, and preventing waste. A frugal person would always weigh up the pros and cons of a purchase and take the decision carefully after analysis. Instead of buying the latest iPhone or having a fancy meal, consider whether you actually need it. Spend your money wisely as it takes only one second to make a purchase while the money spent on it is earned through months and sometimes years of labour.
A certain percentage of your income should be directed towards investments that will multiply your wealth even while you are asleep. You can invest in different assets such as stocks, mutual funds, ETFs, sovereign gold bonds, cryptocurrency, etc. This will enable you to develop an alternate source of income that can be used in the later years. In the words of famous veteran investor Warren Buffett “If you don’t find a way to make money while you sleep, you will work until you die”.
Investing is important. However, the more crucial aspect here is to understand the areas where you are investing. As Robert Kiyosaki, author of the famous book “Rich Dad Poor Dad”, says “Before you invest in something, invest in the time to understand it.” An investment should be made carefully after understanding your risk profile and return expectations as an investor. If you are busy and do not want to spend time understanding these things, you can invest in mutual funds, ETFs, or PMS schemes that are managed by experts for you in return for a nominal fee.
A person relying on a single source of income will have less probability of becoming wealthy in comparison to a person having multiple income sources. You should focus on side hustles or freelancing that will help you to earn more income while investing a portion in assets that give you regular cash flow such as dividend stocks, bonds, rental property, etc. The extra income will enable you to save more for your future expenditures.
The key to success in money management is simple: Healthy Financial Habits. By following the steps mentioned above, you can lead a comfortable lifestyle and retire early.
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