The Best Ways To Protect Your Wealth
What Does Wealth Mean To You?
You know you want to be financially wealthy but sometimes are not quite sure how to attain it or protect it. Before you can build or protect your wealth though you do need to define it. We all have our own vision and definition of financial wealth. What is your definition?
Do you define wealth by your material possessions or household income? Are you wealthy when you review your investments and feel good about the growth? Some people only feel wealthy when their bank account balance reaches a certain amount. Or they consider themselves wealthy if they have money leftover after paying their bills every month. And then again some people never feel wealthy even though they meet their financial obligations on a regular basis and have a large bank account balance.
What you personally define as financial wealth is not important. What is important is taking the time to do it. Because once you understand your own definition of wealth you can create an action plan to attain and protect that wealth. Financial wealth may mean different things to different people but one thing is certain, you need money to be wealthy. Whether it’s money to buy stuff, invest, pay your bills or just look at, wealth is about money. So if are not as wealthy as you would like to be, teach yourself to handle money differently and you will be on your way.
Build Your Wealth In 3 Achievable Steps
Regardless of how you define wealth, building up your wealth is a process. And with some focused effort anyone can achieve wealth. It may take some adjustments on your part, but it is possible for you to be wealthy not just feel wealthy. You would need to start with the basics and stay focused until you achieve. You may need to analyze and change your financial habits if those habits are currently taking you in the wrong financial direction. And the real question is, can you do that? Are you willing to make some adjustments on how you handle your finances? Because if you are unwilling to be honest with yourself and take a hard look at your financial habits you will have a hard time building your wealth.
Step #1 – Pay Yourself First
That is such old advice. It’s been around forever. However even though it’s dated advice, it’s good advice. It’s also the simplest way to save money and it is quite achievable.
Paying yourself first means that before you pay one single bill you put some money aside. That money can be automatically deposited into a savings account or employer retirement account or your cookie jar. It does not matter where you put that money, what matters is that you do it…pay yourself first. You can call it the “pay me first account”.
The importance of paying yourself first is that you teach yourself to adjust your spending. When you force yourself to pay your bills on the leftover money, you will spend less. Just be wise about how much money you put aside. You do not want to put so much money into the “pay me first account” that you cannot meet your other financial obligations. So start out slowly, put a few dollars into that account until you get used to the new system and then increase that amount over time.
Step #2 – Skip Those Extra’s
You only earn so much money, right? Most paychecks are not endless pits of money. So your paycheck has to cover a lot of ground. By only spending your money on the essentials you may be able to get by on less income. Can you spend less on any of your regular extra’s? Can you make coffee at home more often? Eat out less? Shrink your wardrobe budget? The list of where to cut cost is endless. Do you know where your money goes every month? Check out where you spend your money by tracking it. Again, old advice but the best way to determine where to cut spending is to track your spending with a budget. That way you can see in writing where your money is going. Budget living will hold you accountable.
If you want to build up your wealth but like to spend beyond your means you will have a difficult time doing so. It is so easy nowadays to convince ourselves that we can buy anything we want because we deserve it or owe it to ourselves. Advertisers are great at helping us persuade ourselves that we deserve it, we’re worth it and we owe it to ourselves. The problem comes in when we start believing the advertisers. If you truly want to keep more of your money you need to disregard all of those temptations to spend.
Step #3 – Slow Down, You’re Going Too Fast
Advertisers can easily stir your emotions to the point of urgency. Don’t allow yourself to get sucked into the emotional whirlwind. Buyers remorse is not a fallacy, it is real. And it usually happens on large purchases…the ones you generally cannot return without a restocking fee. So before you make any large purchases, slow down, think about it for a while.
Yes shopping is fun. It’s nice to have new stuff or new toys.
Have Fun Building Your Wealth
You build wealth by cutting out the spending. But how can you have any fun without spending money? By taking a different approach to fun. By not attaching fun with spending.
Put your wallet away and discover ways to have fun without spending money. You do not have to always spend money to have a good time with friends and family. We put so much pressure on ourselves to enjoy life. Try to relax and find enjoyment in quiet times, long walks, bike rides, conversation, reading a book, sitting under a shade tree with a friend. You can probably find other ways to enjoy yourself that does not require spending money.
Building your wealth starts with you. Now if you start getting sloppy and go back to your old spending habits just remind yourself that the only money that will be there when you need it is the money you sent ahead. When you are ready to buy a house, pay for your child’s education or even retire, the only money there waiting for you will be the money that you personally siphoned off of your paychecks and put aside.