If you ever wondered how I started my wealth journey, don’t miss today’s post!
Today I’m sharing the exact same steps that I used to get to where I am today. This is the summary so I highly recommend that you also watch my live recording where I go a lot more in depth on each of these steps (scroll down to watch the video).
1️⃣ Have A Plan!
I can’t stress this enough. It’s the first step and it’s where I see a lot of people fail already because they seem to believe that they don’t need a plan.They are just going to do it since they „know“ what they want to achieve anyways. Don’t fall into this trap.
2️⃣ Get Rid Of Your Credit Card Debt
Credit cards are nice, easy and convenient to use but they also bear a great risk that we unknowingly build up „bad“ debt. If you have to use it sometimes, ok, but make sure you pay off your credit asap. Same goes for any kind of unnecessary debt.
3️⃣ Have An Emergency Fund
Yes, even as investors we want to keep some money in the bank in case something happens (for example a crisis). I always advise my clients to keep at least 1 month worth of their expenses.
Yes, even if you are starting out in your twenties, think about your retirement. It should always be a part of your strategy and the earlier the better ;)
5️⃣ Live Below Your Means
Did you know that Warren Buffett has been making the same salary for decades and that it’s less than twice as much than the average salary of an employee in his company? Most people tend to make the common mistake to increase their spending as their salary increases. If you have a plan (see step 1) and want to stick to it (which I hope you do) then make sure to keep your spending low while increasing your income. That way you will be able to reach your financial goals a lot sooner!
6️⃣ Develop A Skill
This step is about increasing your income. In today’s economy it’s not like you’ll learn a profession and then stay with that, working for one company for the rest of your life. Nowadays the possibilities and opportunities to make some extra money have become seemingly endless. So make use of it. Everybody has certain skills that they could charge some money for. What are yours? Don’t have any yet (most likely you do but you just can’t see it)? Develop a skill.
7️⃣ Save For Future Expenses
Your plan from step 1 should also include a budget that would have all your regular income and expenses in it. In this last step you also want to set aside some extra money to take care of future expenses. This is not your emergency fund so don’t mix up the two. While your emergency fund will remain untouched most of the time until an emergency actually happens, future expenses are things that you will have to pay for at some point in the future. Therefore it’s a good idea to take care of them in advance.
These are The 7 Steps To A Great Financial Future that I also partly share in my Nine Step Investment Plan. If you haven’t downloaded it yet, you can make up for it now and get it here.
In this article I gave you a summary of the 7 steps but I also recommend that you watch my live recording where I go even more in depth on each of the steps (use Chrome browser):
How I started my wealth journey. This is what you can do to get started today. The 7 steps to a great financial future. Join today's video.
Posted by Lukas Xu on Wednesday, 6 May 2020
In case the video doesn’t show, you can watch it directly on Facebook.