Get-rich-quick schemes are everywhere you turn. These days, most of them take the form of some sort of internet advertisement where self-professed experts are touting their product or system that will help you get rich quickly. But there is no magic bullet for getting rich.
Tell you what. I’ll make you a deal you cannot refuse. I will tell you right here, right now, for free, how to get rich!
My version of “how to get rich” is not quick, I’m sorry to say. The only way to lasting wealth is a longer-term, slower process. But it is very much worth the journey. The best part is that it boils down to two very simple steps. So, here it is: The magic formula for getting rich is to spend less and save more.
I know, right? Earth shattering. It may seem obvious, but it helps to break it down a little.
Spend less, also known as “living beneath your means,” is the first imperative. Nobody builds wealth without being able to work with some capital. Meaning, you can’t spend all that you earn, or you won’t have any money left to save. It is incredibly easy not to do this in our society. Pressures are everywhere to keep up with the Joneses, and temptations abound. However, somehow, some way, it’s critical you fight the urge to spend every last dime you make. Whatever steps you need to take, this needs to be the goal: Get your spending down below your income, so that you can start stockpiling the rest.
Save more is the second part of the formula. Once you have some resources to work with, you now must put your money to work. We talked some about this in our blog post about giving your money a job, and there are numerous ways to approach saving money. The main point is that you need to start doing it.
I know it’s a bummer. And it can be an incredibly slow, boring road. It is so easy to shrug your shoulders and say, “Screw it, I’m just going to spend my money and be happy.” I can personally attest to the difficulty in sticking with the spending-less-and-saving-more program. Believe it or not, not all financial professionals follow their own advice all the time. In the early days of starting my firm, I spent more than I made – many times over. But I didn’t blow money on stupid crap. I wrote paychecks for people working for me and spent money investing in my business. I had debt up to my eyeballs.
This was all purposeful, however, which made the difference for me. It wasn’t mindless spending that suddenly resulted in debt. It was mindful spending because I believed in my ability to build my business and eventually pay it off. The journey was never easy, and due to that inauspicious beginning, it took me a very, very long time to get where I am today. Digging myself and my business out of debt had to take priority over saving and investing, and that prolonged the agony. My husband and I still have some debt related to our home, but we’ve been saving and investing for years now, and watching those numbers creep up is very satisfying.
Regardless of where you are today along your path to wealth, you can get where you want to be. It may just take longer than you expect, so accept that fact and expect it to happen and you won’t be surprised! Getting rich takes time. Don’t let anyone tell you differently.
What’s your tale of woe? Or your tale of kicking butt with your savings? Share your thoughts and let’s chat. Here’s how:
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*This is an updated version of a post previously published on this blog in January, 2018.