When we are thinking about money tips and how to save money we usually cut back on the little things and focus on growing our savings for retirement.
That is most likely the MAIN goal for many of us (saving for retirement). But what happens when we have a savings and all the steps to being financially stable are complete?
Well that is where these 5 money tips come in play! These tips are what make the rich get richer!
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1. Saving Won’t Make You Rich
When we save money we cut back on our expenses, such as groceries, monthly bills and we use frugal living tips to our advantage.
Think about all the time you spend couponing, slimming your power bill, or negotiating lower rates… now that does help save you money when you are living on a low income, but that is not what this particular post is about!
Imagine all that time spent on saving yourself that extra $1,000 per month put towards making money?
There are so many ways to make money you could grow your savings much faster since there is no limit to how much money you can make.
But there is a limit to how much you save!
2. Create Passive Income Streams
With making money in mind, when it comes to making extra cash, again that does take up your time and we want to be living our BEST life which means our time is precious.
This is where passive income can really change your life for the better!
What is Passive Income?
When you hear people talking about passive income it means they are still earning money after the work is done, and they will continue to earn!
The thing to remember is you will have to do some upfront work but once that initial work is done you can sit back and watch the income coming in.
Some examples of passive income are royalties from books and movies. Creating a product to sell such as an e-book or some form of a digital product are also great examples of passive income!
This quote from Warren Buffett says it all:
“If you don’t find a way to make money while you sleep you will work until you die”. Warren Buffett
Just think, would you rather work 40 hours per week and only make $4,000 per month, killing yourself to just live comfortably.
OR
$4,000 per month doing nothing (except the initial work at the beginning)!?
I think any one would choose the second option. You should also have more than one passive income stream.
Here is a great article that has some ideas for passive income: 31 Passive Income Ideas To Get You Off The Hamster Wheel.
3. Be Smart About Debt
A lot of times if you are in debt you will cut up your credit cards, save until you can pay off your debts and then never put yourself in that situation again.
Not saying that isn’t a good thing to do IF you currently have too much debt to live or cannot control your spending.
However, having some credit cards and paying them off every month will get you some nice free money!
Most credit card companies offer points or rewards for using their cards and PAYING them OFF!
There is also such a thing as good debt, if you invest in real estate and make more money than your payments then that would be a good stream of income!
4. Make one good investment
This good investment I am referring to is YOU.
What I mean by investing in yourself is learning, watching podcasts, hiring a life coach, anything that will broaden your horizons.
“The best investment you will ever make is in yourself“. Warren Buffett
When you gain more knowledge you are increasing your chances of making more money, remember you are only one idea from your first million dollars!
5. Invest your savings in assets
Once you have a comfortable savings established, most people would just keep adding to it until they retire.
Let’s say you have $100,000 in your savings at a 1% interest rate growth, sure that is nice free money being added to your investment but it isn’t enough!
Inflation is on the rise and what if it increases 2% every year? Now you are losing money even though you are “saving”.
Investing in income producing assets such as real estate or a business is a much better use of your extra savings.
Doing this could help you earn 10%, 30% or even 100% back on your initial investment.
There you have 5 great tips on how to take your finances to the next level.
