Building Wealth
Everyone thinks about money and building wealth differently. It’s easy to think increasing your paycheck is THE solution to accumulating wealth and solving all your financial problems. But that’s not always the case. In fact, even the rich don’t get it right a fair amount of the time. Oftentimes all we need is a little more education on the subject. It helps to discover different ways we can increase your income as well as find smarter ways to save and spend the cash that we have. After embarking on a journey of reading many of the most popular financial books out there, I’d like to share with you my notes on 50 practical financial goal ideas that can help you obtain greater financial stability now and in the future.
Now one thing to note before we start. Not all of these ideas are immediately applicable to everyone since everyone’s financial situation is different. I’m generally stating different ideas based on sound financial practices and principles I’ve discovered while studying the subject over the last few years. For example, not everyone right now will be in a place to “purchase an investment property.” If this is the case for you, feel free to leave the idea alone, or better yet, set a goal to get yourself in a financial position that provides you the flexibility of applying these ideas. Anyways, let’s get started!
50 Financial Goal Ideas to Build Wealth:
- Pay off all your consumer/credit card debt.
- Cut up your credit cards if you have bad habits with them.
- Set up an emergency fund. Strive to save 3-6 months of expenses.
- Put your extra savings in a higher-yielding savings account. The national average interest rate for savings accounts is only 0.07 percent. Ally Bank is known for having higher savings yields. Other companies, like Robinhood, do “cash sweep” programs in which your uninvested account cash is automatically “swept,” or moved, into deposits at a network of program banks. These cash sweep programs will often yield a stronger interest rate.
- Start investing and planning for retirement now. No matter your age, it’s a good time to start right now. It’s especially beneficial for younger people since they will be able to accumulate more money over time. A good place to start here is by opening an IRA account and putting some money in it regularly.
- Invest in S&P 500 Index Fund (Regularly). When asked the best ways to invest, there’s a reason why Warren Buffett often gives the same answer and recommends investing in the S&P 500 index.
- Learn about the importance of dollar-cost averaging when investing.
- Read some books on personal finance. There are a lot of great ones out there. Here’s a list of a few I recommend.
- Take some finance courses. Even watching personal finance videos on YouTube is a good start.
- If you don’t have a home, set a goal for home ownership.
- If you do have a home mortgage, look into refinancing if current rates are lower than your rate and you still have a good amount of time remaining on your mortgage.
- If you’re early into a 30-year mortgage and you don’t have high-interest debt, consider refinancing to a 15-year. Though this one can be situational, this can save you big in the long run.
- Open a mutual fund account at your local bank/credit union.
- Pay off your car loan.
- Commit to only buying cars in cash.
- Unless you’re buying a home or investing in your education, don’t buy stuff you can’t afford. Here’s a great video I love that should get this concept solidified in your mind.
- Make connections with wealthy people. Not only can they teach you how to be more financially secure, but oftentimes income and wealth channels come through your network. Sometimes it’s not what you know, but who you know that will make the difference. No wonder 85% of all jobs are filled via networking.
- Make half of your mortgage payment every two weeks. This will enable you to pay off an extra payment each year.
- If you have the means, buy an investment property. If this means having to sell your current home, find a duplex to buy, live in one unit, and then rent out the other to help pay off the mortgage.
- If you have a company 401K match plan, match 100% of your company contribution limit.
- If you are already contributing 100% to your company 401k plan, set a goal to eventually increase your contribution amount to 15% of your income.
- Regularly check your credit activity on freecreditreport.com.
- Create a side hustle or business.
- Create some budgets for all your common expenses.
- Learn to shop smarter by becoming a crazy couponer! The small savings over time really can add up.
- Join social media savings/investing/personal finance groups.
- Commit to buying used when you can.
- Get a smart thermostat to save on home energy costs.
- Try investing in alternative energy sources for your home. Like solar.
- Get a smart sprinkling system. I like the Rachio 3 Smart Sprinkler Controller.
- Work towards a pay raise/promotion at work.
- Set up a 529 education savings account. Many parents do this for their kids, but you can also do it for yourself if you’re planning on getting more education in the future.
- If you have kids, set up (and regularly contribute to) child accounts for various expenses that your kids will incur. (i.e. car, sports leagues, other school extracurricular activities, etc.)
- Set up direct deposits with each paycheck you get to automatically route certain amounts to your different expenses/necessities. There’s a reason why wise financial advisors say “Pay yourself first.”
- Learn the basics of investing in stocks, then solidify that knowledge by actually investing in stocks.
- Learn the basics of company financials (Balance sheet, income statement, cash flow statement, etc).
- Figure out your “Latte Factor” (non-necessities you commonly buy that add up over time) and learn to go without it.
- Learn the importance of time value of money!
- Use a Robo Advisor. For example, Acorns will automatically invest spare change from your purchases and intelligently invest it.
- Try becoming a reseller. See an incredible deal at the store? Buy it at a low price, and sell it higher on places like Amazon and Facebook Marketplace.
- Sell all the stuff you don’t/won’t use in a yard sale.
- Set a goal to avoid or minimize all fees.
- Get your estate planning done, no matter your age.
- Find ways to legally minimize the amount you’re taxed. For example, lower your taxable income amount through pre-tax retirement contributions. (Meet with a tax professional to give you more ideas)
- Get supplemental long-term disability insurance to protect full income.
- Donate some money to a charity.
- Meet with a financial advisor to discuss your current financial situation.
- Write down your financial goals in a planner or app.
- Hold yourself accountable to your goals by letting a close friend or family member know about them.
- Lastly, be patient! 99% of the time building wealth just takes some time!
And that’s it! Hope a few of these ideas help kickstart your journey to better personal finances.
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