You need plenty of money and like to know how to build wealth while still in your 20’s?
Would you like to eat out every day, live in a mansion with luxuries? Or are you, like me, tempted to pack and travel the world? Continue Reading.
As a broke 28-year old, I had always been looking for quick hacks answering my big time ‘how to build wealth in your 20s’ query. However, all those instant wealth-building strategies and schemes did not work (I wish life came that easy) until I learned some effective hacks to build wealth.
Here are the top 6 tips that worked for me to build wealth in my 20s:
- Save, Save, & Save!
- Have Multiple Income Streams
- Invest: Does Wonders!
- Be Financially Literate
- Start budgeting
- Spend Wisely
Back in my early 20s, I used to love spending, visiting different places, eating food, getting those high-end spas but I could hardly fulfill these dreams. I was broke until I came across two finance books that shaped my perspectives regarding money. I learned the top six tips from these books and applied them that yield valuable results!
Now I’m stable with my wealth and I can travel plus fulfill my other lavish dreams without struggling with money. Do you want to know more about these tricks that helped me build wealth in my 20s?
Continue reading to dig deeper into these worthwhile hacks to build your wealth and live a lavish life!
Money saved is money earned!
You must have come across this tip countless times and considered it useless. I used to think the same but reading ‘The Psychology of Money’ by Morgan Housel completely transformed my perspective on savings.
Morgan, in his book, has written an interesting piece about how he started saving when he was 10 which helped him become the richest man in the world.
Moreover, one particular thing that stuck with me after completing Morgan’s psychology of money is that money is the source of freedom. The freedom to not work in your 50s and go for vacations in a cozy place and it is the freedom to relax without worrying about paying bills or mortgages.
After pondering upon this idea, I have started saving a portion of my income every month. It is relieving to know that I have a backup for any emergency or to fulfill my dreams. While the bigger thing is that it gives me a sense of achievement.
The first step is deciding upon a certain fraction of your income. Next is to keep it somewhere you can not reach easily. I’d suggest opening up two bank accounts. One for savings and one for normal use. This will, sort of, lock your money in a savings account and help you build wealth.
You just have to keep depositing that decided fraction every month and voila! See your wealth build up in a matter of a few years.
Pro Tip: Do not get a debit/credit card for your savings account.
Another important thing to internalize early on in your life is that whenever your income increases, the set percentage or amount of your savings should also increase. This is something people often forget. However, income and savings should have a directly proportional relationship. Follow math’s rules, friend.
Wealth is always built from multiple income streams.
All rich people in the world indeed have ‘side hustles’ and that is what makes them rich. However, in the 20s, having multiple jobs can (at times) put one through some existential crisis but it is worth it. The more the income ways, the higher the money.
Again, do not just go and opt for several jobs abruptly. No, it doesn’t work like that. You will be exhausted this way. Instead, choose the options that you love spending your time and effort in.
You may feel overwhelmed at first. But by the time you are in your 40s and 50s, you’ll be making more than what you have had imagined.
Everything is achievable if you have a phone or a laptop. Learn the skills required for your dream work from YouTube or take free courses from Coursera, Skill-share, etc and get to work.
If you want something easy and are not interested in learning skills, you can go for other jobs such as:
- Babysitting for your neighbors,
- Go for a data entry job
- Work for Uber
- Become a food delivery guy
The possibilities are countless. If you want that cash flowing in and building a good wealth in your early years, you need to get up, look for opportunities.
Financial security is maintained by investment. Gone are the days when people used to depend on their savings and think they were rich. Investment help people beat inflation and live a stable life without worrying about everyday expenses.
People now invest and double the dollars. Yet, investing in the 20s can be a deal. But, it’s not impossible and you can definitely invest what you have saved.
All in all, investing in real estate is highly fruitful. Other than this, you can invest in stocks, cryptocurrency, and much more. Explore these options, get a good hang of what attracts you, and invest. You will surely have big dollars in your late 20s if you invest in your early 20s.
If you want to build your wealth in your 20s, start learning now. Read books on finance, consult with experienced people, listen to finance-related podcasts. Likewise, If you need to build wealth, you need to teach yourself the ways to earn smartly.
Here are some sources you can learn from:
- Rich Dad, Poor Dad
- The Psychology of Money by Morgan Housel
- 4-Hour Workweek by Tim Ferris
- Ali Abdal – Youtuber
- Graham Stephan – Youtuber
I, personally, recommend these sources as I’ve learned from them and still learning. So, get your hands on the sources and start learning today. It’ll help you in the long run.
Budgeting is a great way to acknowledge your needs and wants that money can buy. It helps you manage your money effectively and meet your long plus short-term goals. It helps in planning for the future which is something you should start from today.
- Write down your necessities and luxuries
- Put down your goals on a piece of paper
- Note your income
- Determine the expenses for necessities
- Create a budget
- Pay yourself first o achieve your set goals
- Be careful while using a credit card
- Keep a check on the budget plan and your expenses
With this in mind, if you work on your created budget, you can surely achieve your goals and create good wealth. This is a 100% effective trick and following it can make you a millionaire at an early age. Work on it!
Do not be stupid when it comes to spending money. Saying that because I know we spend on our wants without thinking twice. Earning money is easier than not spending it.
Additionally, If you want nice things to impress people or earn respect, money is not the way to do so. Do not get into the business of impressing people. If you’re rich, you don’t need that Rolls Royce horn for you.
Thus, think twice before spending for showing off. Or even if it’s not for showing off, you don’t have to spend money without purpose. Spend wisely because that is what can make you wealthy and live a stable life.
Consequently, the great freedom and richness, lies in your intellect. If you know how to make money and build good wealth from it, that’s the real achievement. If you want to build wealth in this early phase of your life, follow the above tricks religiously.
These six tricks can help you grow rich and build good wealth. So, don’t lose the hang of them until you carve your path to the road of success. The vital message here is to start now! Because, if you do not work on it now then, it will be never!