Real wealth accummulation is achieved by owning revenue streams that is under your control. There are several approaches to wealth creation; for example you can increase the income you already have, add a second source of income, investing in real estate, and by being ruthless in deciding how to spend your hard earned money.
While you surely can trick someone into giving you their money, the easiest way to build wealth is by creating value for others, so instead of thinking ”Wealth Creation” you should think ”Value Creation”. That will give you the right mindset that you need to become really successful, because it shifts the focus from you to your customers.
Transforming Debt into Wealth
Debt is one of the biggest obstacles towards building wealth, and if you’re in debt you’ve got to eliminate it. Two steps to get out of debt fast is to get rid of your credit carts and put at least 10% of your take home income towards paying down your debt. Spending less than you earn is also a key prerequisite for debt elimination.
”Work more. Save more. Spend less. Waste less. You’ll be out of debt and on your way to building real wealth in no time. ”
Wealth Creation Strategies
Here’s two of the best opportunities to build wealth today, and anyone can get started in any of these businesses.
A great way to become financially independent is through starting an information publishing business.
Instead of selling physical goods like flowers or clothing, as an information publisher you sell ideas, guidance, expert advice, . These ideas can be communicated and sold in various forms, like e-books, newsletters, reports, DVDs, membership sites, seminars etc., and once you’ve finished one information product, let’s say an e-book, it’s easy to repurpose that same content and sell it as a DVD, and a membership site, and a seminar.
The easiest way to get started with Information Publishing is if you’re an expert in something that people are interested in. Being an expert is relative, and by reading just a book or two on the subject you’ll probably know more than 95% of the population. If you’re not an expert in anything you can still build wealth in this industry, but the approach might need some adjustment
Information Publishing is a great wealth creation tool because with the internet your production cost is the lowest of any industry in the world. You can sell and deliver 100,000 ebooks for the same price it costs to produce and deliver a single physical book. As you’re in the business of selling ideas and not selling books you can still charge a fairly high price for the e-book. Some people even charge more for the convenience of being able to download the book instantly.
Taking advantage of the growing ”knowledge economy” is one of the best and easiest approach to wealth building.
Generating wealth through real estate investing is still one of the best ways to become financially independent.
Using other peoples money is a great wealth creation strategy, something that many successful investors know. If you buy a $100,000 property with 20% of your own money and you borrow 80%, you only stand for 20% of the risk. If the property value goes down 20% you’ve lost all your money, but if it goes up 20% and you decide to sell you’ve just doubled your investment.
The real power of real estate investment is rent income. Imagine putting in 10% of your own money, for example $10,000 on a $100,000 property, and immidiately start receiving several thousand dollars per month in rent. Of course you will have expenses and loan payments to cover, but it can still be a very profitable investment, especially when the loan has been paid off using other peoples money.
If you use income from rent to pay $1000 a month on the mortgage you’ll have paid off the $80,000 mortgage in less than seven years, and after the mortgage is paid off you’ll not only be the full owner of a +$100,000 property, you’ll also have $1000 a month in passive income which used to go to paying down the mortgage but which now can be used as you please.
When it comes to real estate investing the choices are endless. Should you invest in mobile homes, apartment buildings, condos, single-family homes, office buildings, etc? Should you specialize in one type of building or should you diversify into several real estate types?
The fastest way to build wealth through real estate investing is by acquiring multi-family apartment houses. This is how really successful real estate investors build dynasties.
This is because they understand the concept of unit pricing. You can buy a single unit home for $100,000 and rent it out, or you can buy a 10-unit apartment building for $100,000 and rent it out. The difference in rent income is enormous.