Money Lessons For The Young And Cashless
Here are 11 great tips for those who likes the idea of being richer. These money-making lessons are shared so younger generations, who don’t have money-mentor parents, can be given some easy-to-read and understand guidance. So here they are:
Great Tips For People Who Likes The Idea Of Being Richer:
Work out what bank, building society or credit union you want to work with.
Create a plan to build wealth. Our plan was to buy the worst house in the best street in an up-and-coming suburb, then renovate it, learning to do a lot of the work ourselves. We then would sell it, capital gains tax-free and trade up to a better house, which was again the worst house in the best street. Of course, the “best street” was a goal and wasn’t always achievable but we went for ‘OK to improving’ streets and the strategy worked.
Make sure your super is in a good performing fund and that you aren’t paying more than 1% a year. If you ignore this advice and have an expensive and poor performing fund over 40 years of work, you could lose hundreds of thousands of dollars from your nest egg when you retire.
Put your spending life under the money microscope. It’s called doing a budget. This is where you find out where your money is going.
After you see where you’re spending your money, promise yourself that you’ll GST yourself! This is step two. Put a 10% tax on your spending, so if you spent $50,000 a year, your goal would be to cut that by $5,000!
Now you’ve got the money, decide how you’ll grow this $5,000. If you did this, say at age 25 and worked for 40 years and invested this $5,000, getting say a 9% gain after tax, your first $5,000 saved would roll over, doubling every 8 years until at age 65, when it would be $160,000! And if you found $5,000 every year of your working life, you’d be a multi-millionaire when you stopped work. How? It’s called compound interest and your 9.5% compulsory super will give you a million but your $5,000 a year strategy makes you above average compared to most Australians.
Learn about the stock market and easy investment products called exchange traded funds (ETFs). It pays to become comfortable about stocks. Exchange traded funds can be bought on the stock market. They have lots of stocks piled into one product. An ETF called IOZ has the top 200 companies on the Australian stock market in one buyable ‘stock’. You could sign up with an online broker and buy some units and when you were driving home from work, if you heard that “the stock market was up 2% today”, you’d be 2% richer! It pays to learn about stocks.
Look after your stuff. We waste money by not repairing shoes, painting the house, servicing the car and even looking after our body, so we’re fit and brimming with positivity and someone every employer wants to employ.
Invest in yourself. Don’t be afraid to go to a personal trainer or do courses to make you smarter, richer and even more relaxed about life. There’s a great book called Think and Grow Richby Napoleon Hill that makes the simple case that you can think yourself into a space where you make better decisions — and the payoff is more success and more money.
Hang out with great, positive and success-oriented people. If you’re in business, find a great accountant. If you’re too busy to do your own financial planning, find a trustworthy adviser and learn from him or her. Join groups, go to conferences like those put on by Tony Robbins, read books on self-improvement and biographies of highly successful people.
Write down how you’ll boost your income, either from being the best employee in the country or via starting a business. This will be a work-in-progress effort, but you must see what the future path will be. You need to SWOT yourself to know your strengths, weaknesses, opportunities and threats. Then you need to get in your strength zone and make your weaknesses irrelevant over time. These lessons will help you do it. You’re like a brand in the economy and you must make yourself distinctive, competitive, competent and attractive. If you do that, you will achieve a lot.
To those tips who likes the idea of being richer, you must desire success and then do what’s needed to achieve it. That makes all the difference. Money is like applause from an audience. If you get your act together, the money will follow, like the clapping a great performer receives.
If you need any help in starting a discussion about money, we’d like to invite to get an early access to our How Game are You? Money Edition cards, a suite of game cards that promote real-life conversations around money. To receive sample cards and be advised of the launch dates, pricing, etc., just add your details to the form at the very bottom of this page.