Accumulating wealth doesn’t happen by chance.
It’s the old adage, ‘People don’t plan to fail, they fail to plan’. While this seems cliché when it comes to accumulating wealth it’s important to have a plan to ensure a comfortable lifestyle when you are no longer working.
Now comfortable doesn’t mean being reckless with your money, by buying the latest and greatest of everything. It could mean being able to afford to go out for regular coffees with your friends versus international roast at home. It could mean dining out without it being an anniversary or Valentine’s Day. Comfortable simply means having choices.
Whatever your idea of comfort is, you need to create a plan and stick to it. Good habits will eventually allow you to accumulate enough wealth to shape your ideal future. Sounds easy right? For many it seems an unachievable goal however it is really simply about spending less than you earn and having a plan for the difference.
The first step is to ensure you understand your basic living expenses, then planning what to do with what’s left over. This could mean increasing the repayments on your home loan, starting with a simple investment portfolio or increasing your contributions to super (over and above your employer contributions). All these are effective ways to help grow your wealth.
Increasing the repayments on your home loan could potentially save you thousands in interest and years off the life of your loan as interest is calculated daily.
Starting a simple investment portfolio will ensure any money you have accumulated will work harder for you than simply holding it in a bank earning 1-2%. Medium and long-term investment strategies are a great way to accumulate wealth with guidance from a qualified professional.
Superannuation is a form of forced savings as it is automatically paid in by your employer. The only catch is, will it be enough to fund your lifestyle once you retire?
You could potentially be retired for as long as you have worked. Statistics show that on average, men live for 26 years past the retiring age of 65 and for women it’s 29 years. Many wish to retire earlier. That’s a lot of years to fund your lifestyle. The age pension might only cover about half of what you would need to live comfortably.
Those that live comfortably are those that formulated a plan and chipped away at this over time.
They’re not glamorous ways to build wealth but they are effective ways to build wealth. You don’t have to think too big or make it too complicated. Start small, start today and watch your wealth accumulate. It really is that simple.
Image redit: Billionaires
Contact Kathryn Liebezeit, Authorised Representative (245498) of Hood Sweeney Securities Pty Ltd
AFSL 220897 for more information on managing your money on 1300 764 200 or
Disclaimer:
Information contained in this presentation is of a general nature only. It does not constitute financial or taxation advice. The information does not take into account your personal situation.
We recommend that you obtain investment and taxation advice specific to your objectives, financial situation and specific needs before making any investment decisions or acting on any of the information contained in this article.
The information in this document has been derived from sources we believed to be reliable and accurate. Subject to law, neither Hood Sweeney Accounting & Business Advisory ABN 30 007 696 595, AFS License No. 485569 or Hood Sweeney Securities ABN 40081 455 165, AFS License No. 220897, nor their directors, employees, agents or representatives gives any representation or warranty as to the reliability, accuracy or completeness of the information; or accepts any responsibility for any person acting, or refraining from acting, on the basis of the information contained in this article.
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