10 Smart Ways To Grow Your Money Fast
Making money and growing money are two terms that are often misunderstood; while these two tend to imply the same thing, they don’t necessarily have the same meaning. To make money, you need competence and skills, but to grow your money, you need a bit of frugality, savings, and a good understanding of investment and equity. While your bosses may determine your salary raise, they don’t have any say in you growing your finances. Statistics show that a staggering two-thirds of American adults can’t pass a financial literacy test. So are you ready to start taking control of your finances? Then check out these ten smart ways to quickly grow your money.
- Be an early bird
Investments take a significant amount of time to grow, so the earlier you start investing, the better your returns. Assuming you want to raise your money and fix your savings at $80 a month and want to retire at 60 to enjoy your life; you would need to save a smaller amount of money if you started at age 20 rather than 30. This is due to the power of compounding that promotes the growth of your money over time.
- Be smart with your investment
Just a quick search on the internet will reveal a great deal of information on how to invest your money, but do they work? Not all information you receive online can be trusted. Do not fall for the glamourous investment advert always buzzing on your screens. Be smart while using your discretion and insight to make your investment choice. If you are more of a risk-taker, you can make the most of the stock market. Scared of losing your money on stock market fluctuations? Then you can take the conservative approach. Whatever you do, don’t invest your money in a venture you don’t understand or that doesn’t suit you. If you do, invest what you can risk.
- Stay away from debt
If you found yourself buried in a heap of debt, it is practical to address them first before thinking of making your money work for you. If you found yourself in credit card debts, get to know how much you owe and start getting rid of it. You can adopt the famous snowball method, which suggests you pay less on all your debt while spending the most on the card with the least balance. There are several other ways you can do this; the most important thing is to eliminate your debt. While at it, do well to avoid taking new debt unless it’s essential.
- Track your money
The only way to get serious with growing your money is to control your finances. That means you need to have an understanding of how much you earn, spend, and invest. With this, you can create a budget that aligns with your overall financial plan. If you find yourself not knowing where you start, there are several online resources you can use. The important thing is to stick to it. For individuals new to budgeting, it is easier to overlook even after putting together the plan.
- Save, Save, Save!
Several financial experts have described saving as paying yourself first. Considering that saving is key to growing money, it appears so easy until it’s time to commit to a plan. According to a recent survey, 33% of American adults have saved nothing towards retirement. While the average American needs at least a million dollars to retire, the current trends mean most Americans will need at least double this figure, which is terrifying. Generally, people regard bills as priorities, unlike savings which are treated as an afterthought. The key is to treat savings as an expense.
- Build a residual income stream
This is a terrific way to build your long-term financial wealth. The significant increase in online platforms has created several opportunities to earn residual income easily; it is the money you continue to make after initially completing work, unlike an active income, say, an accountant or mechanic getting paid for work done. Some residual income ideas include building a website to sell products, creating an online course, or starting a YouTube channel. Like YouTube, you continue to earn from advertisements on every thousand views your content generates. Are you planning on taking a vacation? You can put your home or rent out that extra bedroom while you’re away.
- Start a side business
While budgeting helps you gain full control over your finances, you’ll be spending less, which means you can pay yourself more. But what if you can earn more? You can earn extra cash if you start a side business or take up a part-time job. There are flexible jobs you can take outside your full-time work. From online tutoring to freelance writing and web designing, there are several jobs you can consider depending on your skill. With your budget built around your primary income, additional earnings from other sources can go straight into your savings.
- Create a steady investment
One way most people fail a lot is running their investment with emotions. We get off so aggressive at starting a new venture as a human tendency, but we begin having a second thought on whether this is something we want within weeks. This is the case when we aggressively start learning a new language, working out, or investing. Unfortunately, with investments, such attitudes lead to loss of money. Money requires consistency to grow and to do this, you need to set investment targets and familiarize yourself with market trends. You should diversify your portfolio across several asset classes like funds, stocks, and bonds. This protects you from market downturns, consequently reducing your tendency to cash out on an investment.
- Base your investment on your priorities
As you grow, your priorities and perception of life come along with you. It’s about getting the latest smartphone, buying a trendy pair of jeans, or impressing the love of your life for a young person. But as you age, these things become less and less relevant to you. The same principle must apply to your finances. It is okay to invest in high-risk-high earning investments at a younger age, but you’ll need to take a more conservative approach with time. Although the rate of return will differ considerably, the course is about protecting what you’ve acquired over the years. In simple terms, focus on debt-oriented rather than equity-oriented funds.
- Seek professional advice to grow your money
The journey towards financial freedom can seem an impossible task. If you are undecided about your objectives and goals, you should seek a professional’s assistance. A financial advisor will look at your numbers and make recommendations on what should suit you, including investment and the line of action to take. As we are gradually growing into a do-it-yourself culture, it’s tempting to avoid asking for help. Unfortunately, with finances and investment, the consequences can be dire. There is no wrong in asking for support; you can consult a resourceful family member or friend with a good financial track record. This way, you can make informed decisions that can determine your fate in just a few years to come.
If you’re wondering when to begin this journey to financial independence, then there is no better time than now. You’re probably too busy or so much behind bills and mortgage payments. As legitimate as these concerns may be, they are not good enough to prevent you from taking that step to grow your money. It will take discipline and the above strategies to realize that financial freedom is much closer than you know.