Part of building wealth is learning to discipline your spending habits so that you are always operating in the positive — instead of racking up debt.
If building true wealth for yourself is something you’re interested in, these 5 steps will be your foundation for establishing positive financial habits that will move you closer toward your goal.
1.Never spend what you don’t have
The most simple step toward building wealth is spending less than you make.It’s the truth which even Warren Buffet swears by– many people spend more than they make and float the difference on credit cards. They assume they will make more in the future and that it will all “even itself out,” when in reality, the moment they start making more money, the more they spend.
If the government suddenly increases tax rate then you will pay(you have to) so why not you place a tax on yourself and put away an extra $100 or 5,000 rs in a bank each month!
3.Don’t play the stock market
If you’re not doing it full time and think that like several traders you can do it part time and earn enough return then let me tell you that you will only be at a loss.Stock market is very clever and in order to understand it you will need to be on your toes 24 hours a day.
4.Have an extra source of income
According to Warren Buffet, the average millionaire has seven sources of income. Having multiple income streams is just part of the process.
The best thing you can do is figure out what you can provide or offer people that delivers true value. A perfect example is internet famous entrepreneur Sam Ovens, who has made millions selling online courses and consulting business owners.
5.Never accumulate credit card debt
No matter how entrepreneurial you are, maxing out your credit cards without reliable streams of income to pay them off in a timely manner is irresponsible.
You always want to make financial decisions based on what you’re currently making, not what you think you’re going to make.