How to build Wealth in Young Age

Everybody in the world wants to become wealthy. Most of us dream of becoming a Millionaire, and also feel that it's just a dream which cannot be fulfilled even after hard work.

Such people lose their hope and start thinking that there is no way to build wealth and fulfill their dreams.

It's not true, if you really want to become rich, you can fulfill your dream by just fulfilling some basic points. By adopting the habits in your daily life, you can know how to build wealth in young age.

What is the meaning of wealth?

Wealth means everything through which we can survive and save for the future. it includes your income, stock, property, investment etc.

Why is there a need to build wealth?

1) Fulfill of Dreams

Everyone in the world dreams to become rich and want to build wealth for the future.

So, building the wealth results in fulfillment of your Dreams like buy a luxury car or big house etc.

2) Responsibilities

Till the age of 30s you come across less financial responsibility. But above 30s, your responsibility also grows. you need to take care of your family and focus on earning.

You need to save money for the future of your children, so, for all this you need money and you need to build wealth also.

3) Better life after retirement

Everyone wants to live a peaceful life after retirement i.e. life without stress. So you should build wealth as early as possible.

If you start building wealth at the younger age, you get a better return for your future.

How to build Wealth in Young Age?

There are seven ways as mentioned below, if you follow these then definitely you can increase your wealth and become rich.

1) Increase your income 15% to 20% annually

If you really want to build wealth, then you need to increase your income.

You can increase your income in many ways like if you are in a job then you can look for a part time job as well.

If you have a vacant house then you can put your house on rent. You can also use your skill to grow income like painting, driving, teaching etc.

So, there are many ways to increase your income. There is only need to think about it.

At least, you need to increase your income 15% to 20% annually because inflation also increase every year around 10%.

If your income grow less the inflation rate then it means your wealth will reduce over the years and your saving will not sufficient to purchase your future dream like House, Car, Children Higher Education and Marriage etc.

2) You need to Think Vast

You need to think vastly if you really want to build wealth.

If you restrict your thinking like your income to be 50,000 thousand per month, it means you limit your thinking and your mind will accept it and your income will not grow more than possibility.

But if you open your thinking for unlimited wealth, then your subconscious mind will start thinking about how to build wealth in young age.

If you feel that your employer is not giving you salary according to your skill or providing less salary than the salary of other employees in the industry for the same scale then negotiate with your employer to increase your salary and not think to change your Job until you save at least income equal to 1 year for surviving because it may be you will not get new job for two to three month as per your choice.

3) Always control your expenditure

The best way to build wealth is to reduce your extra expenditure. Sometimes our wants are more than what we actually need to live.

Try to reduce your wasteful expenditure like watching films in cinema, eating at restaurants, buying luxury products etc.

You can reduce spending on those expenses by converting your habit of watching film on TV instead of Cinema and enjoying eating at home and so on.

In this way, you can easily save 5% to 10% your monthly income and invest it in long term income plan to build wealth because due to compounding effect your current saving will increase fast as more the years you invest. So, you need to build habit of saving in early age and invest it for future need.

4) You need to Preparing monthly income and expense budget

Just look at your monthly income and prepare your monthly budget.

Divide some part of your income for important expenditure and also save some part of your income.

Fix your EMI payment in your budget and start saving from just 20% of your income and you should follow these on a monthly basis.

As per our opinion, you have to divide your monthly income in the following ratio.

General Expense : 50%

EMI Payment: Not more than 15% to 20% of you monthly income.

(Do not habit to take loan for general need instead take loan for increase your income)

Emergency Fund : To be build equal to 6 month of your salary.

Saving and Investment for Future: Remaining amount.

Just stick to your budget plan, if you make a budget before you spend on wasteful activities, you can easily build wealth in young age.

5) Save and build fund for unforeseen feature

Saved money should be deposited into a savings or fixed deposit account. Save money will protect you from unforeseen future and any emergency expenditure on medical treatment, loss of job etc.

Set aside funds and do not use it for any purpose except in emergencies. You should at lease save amount equal to 6 month of your salary and increase this fund as your salary increase.

6) Invest your savings

If you start building your habit of saving regularly for 6 months then think about investing your savings in the financial market.

Start investing a small amount in the beginning for a longer period and you get the benefit for compound income. Gradually increase investing when your savings increase.

7) Written plan

Always make a written plan like a budget. Just write how much is your income and out of which how much you can save. Write your wasteful expenditure and then try to reduce it. Just have a written record of your investment.

Always compare your budget with your actual expenditure and find the deviations and be positive to take action on it in the next budget.

This way you can plan your better life.

What is the right age of building wealth?

There is nothing such as the right age of building wealth. You can build your wealth at any age but it is right to start saving and investing at a young age till 30s, because during that age you're not under financial responsibility.

But it does not mean you can invest only till your 30s. You can build your wealth at any age by just focusing on points discussing it earlier.

Conclusion

In summary, try to increase your income, save some part of it on a regular basis and then invest in the right way. In this way you can build Wealth in Young Age and fulfill your dream for a better life.

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