If you want to know how to get wealthy, here are 8 things that you absolutely need to know.

Wealthy people share a lot of common traits. If you model yourself after these traits, there is a good chance that you can become wealthy too!

1. How to Get Wealthy Step 1 – Pay Yourself First

Wealthy people always pay themselves first. When that cheque shows up in your mailbox or drops into your bank account, what should you do first? Most people go out and buy some new stuff, then pay some bills, buy some groceries, then see what’s left over. If there is anything left (usually there isn’t), they might consider putting some of that money aside in investments.

Wealthy people do not follow this approach. Wealthy people always put money aside for investments right off the top of any money they receive. They know that their investments are more important than any creditor, or any new stuff that they might want. By putting money aside for their investments first, wealthy people are ensuring that their wealth will continue to grow.

Studies have shown that the wealthiest people usually put 20% of their income aside for investments and use the remaining 80% for living expenses.

2. How to Get Wealthy Step 2 – Live Below Your Means

Wealthy people always live below their means. Most of them do not drive expensive luxury cars or wear top of the line clothing. They spend their money frugally and use the money they save to continue growing their wealth.

People with a poor spending habits often go out and buy cars with payments that stretch their monthly income. They also tend to go out and use their credit cards to buy new electronics, clothing and toys that they don’t really need.

Let go of the desire to have the latest and best stuff. Make building your wealth a higher priority than status symbols and owning stuff that loses value anyways.

3. How to Get Wealthy Step 3 – Create and Follow a Budget

The best way to make sure that you live below your means is to create and follow a budget. After you have taken out the percentage of money you are allocating for invesments. Allocate the rest of your money using a budget, and make sure you follow it. This will ensure that you don’t overspend and end up racking up debt.

4. How To Get Wealthy Step 4 – Learn How To Invest

If you want to become wealthy, you need to learn how to invest your own money. The vast majority of wealthy people handle their own investments. They don’t hand their money over to a financial advisor who is really best served by investing their money in whatever earns them the most commissions.

Wealthy people understand that their money is best handled by the people it matters most to – themselves.

It isn’t that hard to educate yourself on how to invest. Your local library is sure to have several books available. There is also a lot of information available online. And most bookstores also have a section on investing. Read information from lots of sources and you are sure to find something that will fit well with your goals, resources, and risk tolerance.

5. How to Get Wealthy Step 5 – Learn The Difference Between Active and Passive Income

Wealthy people know the difference between active and passive income. And they also understand that it is of the utmost importance that they build up as much passive income as they can.

Active income is income that comes from exchanging your time for money. For most people this is in the form of a job that you go to that pays you money for each hour that you are there. With this form of income, you can only make as much money as the hours you are able to work. This income can also be cut off very easily if you are fired, get laid off, or become to ill to work. If you can’t work, you don’t earn any more money.

Passive income is income that is generated no matter what you are doing. This type of income comes from various sources including: real esate investments, business income, online incomes, or investment income. These income sources will continue to earn money for you whether you are able to work or not. They continue to earn money even while you sleep. Passive income is critical to building wealth and making sure you always have income coming in no matter what else is going on in your life.

To learn more about passive income, please read “What Everybody Ought To Know About How To Get Rich”

6. How to Get Wealthy Step 6 – Start Young If Possible

The more time you have on your side, the better your chances of becoming wealthy.

With more time, you have more opportunity to take advantage of compounding interest. Compound interest is when the interest you’ve earned from an investment gets added the principal amount you invested, and that interest earned also begins to earn interest on intself. As this process repeats year after year, the process is called compounding.

An extra ten years of this compounding process can add hundreds of thousands of dollars to your investments depending on how much you’ve invested and for how long.

7. How to Get Wealthy Step 7 – Set Goals

You need to have a clear idea of where you want to go before you can figure out the route you need to take to get there.

Wealthy people always have goals. They know how much they want to have, and by when. And they have a game plan on how to reach that goal.

You should do the same. If you plan on reaching this goal by investing. Use an investing calculator to figure out how much you need to be putting away and what returns you need to be getting to reach that goal.

Once you have your plan in place. Follow it. Then check and adjust as needed as time goes by.

8. How To Get Wealthy Step 8 – Get a Mentor

The best thing you can do for yourself if you would like to become wealthy is to get a mentor. Try to meet people that are already wealthy and build relationships with them.

Contrary to how the media tends to portray wealthy people, most of them are very giving, extremely nice, and would be more than willing to help you out if you only ask.

Look for local places where you can meet wealthy folks. Country clubs, golf courses, yacht clubs, etc, are all great places to start looking. You could even hang out in the business section of your local bookstore and chat with some people that come through.

If you are really averse to meeting new people, don’t lose heart. You can still find mentors through other means. Mainly reading. Books written by wealthy people can offer a treasure trove of advice.

This concludes our eight things you need to know about how to become wealthy. I invite you to learn more about how to get wealthy by checking out the related articles listed in the table below. Or you can check out our full list of articles on how to get rich.

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Did you know that having a job is one of the worst ways that you can possibly earn money? Most of us have been brainwashed with the old addage that you should go to school, get good grades, then go get yourself a nice secure job. There are several reasons why I think that working for somebody else is actually a bad idea. Let me share ten of them with you today.

1. Trading your time for money is one of the worst ways to earn money.

Who taught you that you should only be paid for the time you work? When you have a job, you get paid in exchange for the time you put in. So what happens when you get sick, or have a family emergency that doesn’t allow you to go to that job for any period of time? Your income stops and you suffer financially.

Wouldn’t it be better to make money 24 hours a day, 7 days a week, 365 days a year, even if you aren’t actually working? This type of income is called passive income and it really isn’t that hard to do. You can generate passive streams of income in many different ways. You could have a website that makes advertising and affiliate revenue for you all day long. You could write a book or a song that generates royalties. You could start a business that runs without your active involvement (McDonald’s owners are a good example of this). You could invest money and live off the returns on your investments. You could buy real estate and generate rental income. There are more ways, but this list should help get your creative ideas flowing.

The main concept of generating passive income is that you are trading value for money instead of time for money. For example, say you choose to create a website about basset hounds. You take the time to write lots of informative articles and post lots of pictures about basset hounds on your website. Once all this work is posted up on your website, people can come by and surf around your site over and over again. The articles that you had to write just once will keep providing value to your site visitors over and over and over again. Those articles can keep generating advertising revenue for you day after day after day without any further involvement on your part.

Even if you don’t know anything about generating passive income streams, it’s worth taking the time to start learning. Time is going to pass anyways, so you might as well start developing these income streams now so that you can free yourself your future self from trading your time for money. If you don’t start doing something differently, nothing is going to change for you.

2. Jobs limit your experience

When you work at a job, you are only gaining experience doing one thing. When you are in charge of creating your own income streams, you begin to gain experience in a lot of different things. These experiences will help you learn and grow and get even better at creating value for others and making money doing it. Which type of experience do you think is going to benefit you the most in the long run?

3. Jobs limit your freedom

How does it feel to have to get up every day to be somewhere that you probably don’t want to be, doing something you probably would rather not be doing? While you are at that job, you are being told what to do, when to do it, when you can take a break, for how long, how much your time is worth…

Does that sound like a free person to you? If you decide one day to not get up and go to that job, you risk being fired and having your income dry up. If you trade value for money, instead of time for money, you are free to choose what to do with your time, and you are free to make as much money as you like. If you want to make more money, you just need to create some more value.

4. Jobs syphon most of your income away

When you work at a job, you are lining everyone else’s pockets. People with jobs are the most heavily taxed individuals. People with businesses have all kinds tax write offs and tax shelters. People with jobs are making the company rich and the owners of that company are benefitting from all your hard work. Stop making everyone else rich, start putting your efforts toward making yourself rich instead.

5. Jobs are NOT secure

Why do most people thinks jobs are a safe way of making money, and that owning your own business is risky? Think of it this way, whether or not you actually own your own business, you are in business. The thing is that when you have a job, the only customer for your business is the company you work for. If that company ever decides they don’t want your services any more, your income is gone.

On the other hand, if you own your own business, or are generating income in other ways, you have lots and lots of customers. If one of those customers ever decides to leave you, only a very small portion of your income is lost. The chances of all of your customers leaving you at once is a lot smaller than the chances of your boss deciding that they no longer want your services anymore. A business will offer you more income security than a job ever will.

6. Jobs give you no control over who you have to interact with

When you go to work, you have very little choice about who you interact with. Your boss or coworkers might be the most horrible people to have to deal with ever, but you have no choice but to suck it up and deal with it.

When you have your own income streams, you can choose who you want to work with. If you run into somebody that really irks you, you can just walk away and find somebody else that is much more pleasant.

7. Jobs fix your income

Having a fixed income is a horrible experience. When your income is fixed, you have to follow budgets, monitor your spending, deny yourself things that you really want to have. Basically, having a fixed income, forces you to control your spending and deny yourself things.

When you exchange value for money, if you want to make more money, all you need to do is to create more value. Nobody is there to tell you that you can’t be paid more. You are the one who decides what your income limits are.

8. Jobs actually stifle your social life

When you work at a job, you see the same people every day, and probably talk about the same stuff every day too. How exciting is that?

When you are in control of your income, you a free to go out and socialize with whomever, whenever you like. You are likely to meet more interesting people and run into more income generating opportunities this way.

9. You lose your freedom and individuality with a job

Does your job tell you how to dress, what your work area should look like, how you should conduct yourself on the job? Does this sound like freedom to you?

Take control of your life again. Generate your own income and choose how you want to dress, how you want to act, and what your work area will look like (if you even want to have one).

10. Jobs kill your will

Most employees like to complain a lot. But they also rarely do anything to change what they are complaining about. Problems become everybody else’s fault and everyone else’s responsibility to fix in the eyes of most employees.

Unfortunately, this mindset also tends to spill over into other areas of the employee’s life. Soon, they do little to change anything in their life for the better. Instead, they just complain, and hope somebody else will fix their problems for them.

Take your will back! When you take control of your income, your confidence grows and eventually soars. This confidence will spill over into other areas of your life. Soon you take responsibility for everything in your life and you also take action to get where you want to go instead of just sitting around and complaining about how bad things are. Your life will become amazing.

Get Started Today

It’s never to late to take your life and your income back. There are many ways to make money outside of a job. Perhaps one of the easiest ways is to take what you are doing now as an employee and start trying to figure out how you could do the same things, or something similar, as your own business. If you know enough about a skill or hobby to write a book, or create a website about it, you could make money that way.

If your unfamiliar with creating and marketing websites, but the idea of making money online interests you, I highly suggest checking out Site Build It. They will help you create and market a new website with step by step instructions. No technical knowledge is requires as they handle all the technical stuff for you.

Start brainstorming and creating your financial freedom today. Don’t leave yourself stuck as a job slave on a fixed income for the rest of your life.

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My grandparents seemed to know a thing or two about how to be frugal. Chances are, your grandparents did too. Times have changed since then. Somewhere along the way, many of us lost the knowledge of how to be frugal.

Let’s take a walk back into the past to see what we can learn from their examples. I’m sure we can dig up a few things that will help us save some money.

Here are ten things that I remember from way back that could teach us a lot about how to be frugal today.

1. Consider repairing something before you replace it. When something breaks down, see what it would take to repair it. It might be less expensive to repair it then to replace it.

2. Take care of your stuff. Previous generations took pride in what they owned. Cleaning, maintenance, and proper storage can help your stuff last longer. New cars were a rare thing to see on the road 50 years ago. People repaired and maintained what they had. Imagine how great it would be to not have a car payment coming out of your account every month.

3. Do maintenance and repairs yourself. Many of us today are quick to pick up the phone and call in a professional to install that new outlet or change the oil in our vehicles. If you want to know how to be frugal, you need to learn how to do more things yourself. Many of these tasks are not all that hard to do if you look it up on the internet or pick up a good “how to” book at your local library or book store. Doing things yourself can save you a pile of money

4. Cook and bake from scratch. Previous generations rarely bought pre-made or frozen meals, desserts or baked goods. They cooked their meals from scratch and baked their own desserts and snacks. If you want to learn how to be frugal, Cooking from scratch is something to look in to. It doesn’t have to take a lot of time or effort if you follow some easy recipes. Just do a quick internet search and you will find plenty.

5. Grow your own food. Backyard gardens were everywhere when I was growing up. People grew their own food because they knew a lot about how to be frugal. It doesn’t take a lot of work to have a small garden in your backyard, and you will be surprised by how much produce you can get from it.

6. Eat in. Eating out was a rare treat to my grandparents. Today, many of us eat out once or more a week. Imagine how much money you would save by staying in and cooking your own meals. Save those dinners out for special occasions.

7. Share what you have. My grandparents will always borrowing and sharing with neighbours. If they needed to cut some branches off of a tree, they didn’t go out and buy a tool to do it. They asked around the neighbourhood to see if somebody else already had one that they could borrow for the day. How many tools do you own that you have only used once or twice. Save your money and share or borrow with others.

8. Mend your clothes instead of replacing them. My grandmother could be seen from time to time sitting and mending piece of clothing. By mending the clothes you have, you could save yourself from having to buy new. A tear along a seam is not hard to fix and the repair isn’t even noticeable after it’s done.

9. Put a sweater on if you are cold. Don’t be so quick to reach for the thermostat. A sweater and a pair of slippers can warm you up a lot without you having to pay a higher heating bill.

10. Make do with what you have. This is another great how to be frugal tip that my grandparents followed. They weren’t concerned with having the latest and greatest technology out there. They made do with what they had. Ask yourself if you really need that new gadget before you go out and spend your hard earned money on it.

If you want to learn how to be frugal, take some time to reflect on how previous generations did things. If there was anything you learned from your grandparents, please take a moment to share them in the comment box below.

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Banks and credit card companies will often try to sell you loan insurance. But is this protection really worth the cost?

The purpose of this insurance is usually to pay off the balance of the loan if you pass away before it is paid off. Sometimes this insurance will also cover your minimum payments if you become unemployed.

As I have mentioned in some of my other articles, the main purpose of insurance is risk management. But it is possible to be over insured or to spend to much money on insurance. Quite often, there are lower cost options available to you.

Loan Insurance For Your Life

Life insurance on loans is usually a bad idea. In most cases, the cost per thousand dollars of coverage is very high! The insurance offered by credit card companies is often the most expensive life insurance you can buy.

Having life insurance on this debt is a good idea if your family will face hardship should you pass away before the debt is paid off. However, your best bet is to skip the offer from your creditor and go shop around for a short term life insurance policy. It’s easy to do online with websites like Hometown Quotes in the USA or Kanetix in Canada. These sites will automatically get several quotes for you to compare.

Loan Insurance For Unemployment

If you do not have an emergency fund of 3 to 6 months of pay put away for a rainy day, then having loan insurance to cover your payments if you lose your job might be a good idea. Especially if you are not confident in the security of your job or business income. If this is the case, having job loss insurance on your debt will help protect your credit rating in the event that you lose your job and are unable to make payments toward your debt.

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Debt consolidation is when you condense all your debts as well as loans into one debt account and pay off your debts thereafter. There are 2 ways to consolidate your debts. One is by enrolling for a debt consolidation program and the other is by taking out a debt consolidation loan.

Undoubtedly, enrolling for a debt consolidation program is a better choice because it allows you to restructure your existing debts. You also get a repayment plan according to which you can make payments and keep track of the same. However, there are few debtors that opt for debt consolidation loans. And these loans that are similar to personal loans have also helped many debtors to get out of debt. Whether it is a debt consolidation program or a debt consolidation loan, the main aim of these programs are to lower the interest rate thereby making your debts affordable.

Debt consolidation loans can be either secured or unsecured loans. When you opt for a secured debt consolidation loan, the rate of interest the loan attracts will be less. This is because you are using collateral that acts as a safety net for the lenders. So, they allow you to make payments as per lower interest rate. In majority of the cases, the collateral used is your home.

On the other hand, if you opt for unsecured debt consolidation loan, you will be required to pay a higher rate of interest as you are not using any collatera

Once you get a debt consolidation loan, try to make the best use of it and do not waste it by shopping or on leisure activities. Often it is seen that debtors tend to misuse the cash. Statistics reveal that only 60% of the citizens in United States pay their creditors consistently. This was the scenario as of February 2009.

Making judicious use of cash is the mantra of paying off your debts faster and in a hassle free manner. So, take your finances in your stride and don’t forget to save for the rainy day.

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