Women In Business

How to build the right mindset for a wealthier future

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Everyone wants to be wealthy, right? Have you ever met a single soul that says, “what I’d really like is to struggle for money all my life and then retire without enough money to live comfortably”? Of course, not. Yet, an enormous number of people live their lives struggling for money and hit an uncomfortable truth when it comes to retirement too. That’s because they never worked to become wealthy.

What is wealth?

My definition of being wealthy is when you have enough money either in the bank or coming in as income, which you do not have to work for, to make any reasonable decision that you like. That means you can take a vacation when you want. It means that you can receive the best medical care should you need it. It means that you do not need to be a wage slave and can take a week off sick or to look after a loved one without worrying about the impact of that choice on your bottom line.

How do you get wealthy?

It’s important to realise that you cannot just go to work to make yourself wealthy. Most people will always spend pretty much what they earn and even borrow beyond that. There are an awful lot of bankers out there a paycheck away from financial oblivion. They may seem rich but ultimately, they’re a hamster in a wheel chasing their wages the same as the guy working in a warehouse is.

To become wealthy, you need to invest. You need to invest in assets that make you money. An asset is literally anything that you can invest in that provides a return on that investment.

How do you invest when you’re not wealthy to begin with?

Starting to invest requires a little sacrifice but here’s how to approach. Imagine that we lived in a world where jobs were impossible to find. Having a job made you incredibly lucky and if you lost that job the chances of finding another were almost zero.

Now imagine that your boss came to you one day and said, “I need you to take a 10% pay cut. Everybody is doing the same thing. If they don’t the business will close and you will all lose your jobs.”

You might be angry about that when it happened but you wouldn’t quit because you couldn’t find a new job in our imaginary world. In fact, within a month or so – you’d be managing in the same way that you always had. You’d just make a few minor sacrifices in life. You’d switch out your brand of coffee or buy clothes from a cheaper label.

That’s what people do when they find themselves in reduced financial circumstances, they cope.

So, the trick is to give yourself that pay cut. Take 10% of your income every month and put it to work buying assets. You can start today.

And instead of paying for everything you want and then seeing what you have left. You take that 10% first and you buy your assets with it. Then you use the 90% that’s left to buy everything else you need.

It might hurt for a month or two to make that sacrifice but if you keep doing it every month, it won’t hurt for very long.

But 10% isn’t a lot what kind of assets do I buy?

A good place to start with small sums is to invest in stocks and shares. Pick companies you know, you recognise and trust and which do good things. Ideally, pick companies where you understand what it is that they do too.

A few shares purchased every month by the end of a year will add up to a substantial amount of money. They should have shown some equity gains. If you bought the right shares they’ll have also paid some dividends too. Take those gains and use them to buy more shares.

Keep doing this until you have enough money to put down a deposit on an investment property. (It won’t take long if you keep reinvesting everything that you get back.) Then use the bank’s money to leverage a much larger asset.

Rent it out. Collect the rent to pay the mortgage. Wait for the equity in the place to rise. Use that equity to buy another house.  Repeat over and over. All the time, keep taking that 10% of your salary and use it to invest in more stocks and shares and keep reinvesting there too.

Within a few years, you’ll have a large number of assets. Those assets will provide a truly passive income. That is an income that you don’t work for. When that income is larger than your salary and it covers all your needs – you’re wealthy.

One simple change in your mindset is all it takes. Invest in yourself and your future.

About Leonie Fitzgerald

Leonie began investing in property at the young age of 18 and since then her passion has grown to help people and families master money and create a life of abundance – whatever that looks like for them. Not only is Leonie a savvy property investor but she has an unquenchable thirst for self- education and knowledge that empowers and inspires. www.wealthology.com.au

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