How to Build Your Wealth?

Claire Emma  2019-09-12 18:12:38

Building wealth is our dream. After years of hard work and toil, one wants his wealth accumulated and gains fruit. But how do you set aside the needs of the present and invest in your future? Here's a quick but comprehensive guide on how to do just that.

  1. 1Talk to a certified financial planner. Have you ever heard the phrase "It takes money to make money?" Well, when it comes to a good financial planner, that's often the case. A financial planner will cost you money, especially if she's a good one. But the idea is that she'll ultimately make you more money than she charges. By that measure, it's a good investment. It will help you build wealth. A good financial planner does a whole lot more than manage your money. She teaches you about investment strategies, explains short- and long-term goals, helps you develop a healthy emotional and rational relationship with wealth, and tells you when to spend some of your hard-earned shekels.
    • 2Decide if you want to start investing parts of your portfolio. Investing your portfolio is crucial if you want to build, and not just maintain, your wealth. There are tons of different ways to invest, and investing in the stock market a good financial planner will be able to guide you in the right direction. Here are some ways to think about investing:
      • 3Try not to get tangled up in day trading. You may think that you can make a killing off the stock market by buying low and selling high each and every day, but time will eventually catch up to you and prove you wrong. Even if you marshall solid business fundamentals, industry health, or other value-investing tenets when making your picks, what you're doing is essentially speculating, or gambling, instead of investing. A mountain of academic research has found that day trading is not profitable. Not only are you incurring big transaction fees each and every day, but you're usually only seeing 25% and 50% increases — if you're lucky. It's very hard to time the stock market correctly. The people who simply choose good stocks and leave their money invested for long periods of time usually make far more money than people who flit back and forth buying and selling.
        • 4Consider putting money into foreign or emerging markets. For a long, long time, United States stocks and bonds were the most lucrative thing you could invest in. Now, emerging markets are offering more growth in certain sectors. Investing in foreign stocks or bonds will round out your portfolio and give it the risk reduction that you might not otherwise find.