| Imagine what you could do in your life if you had | | | | fairly safe place to build your wealth - slowly. But if you |
| financial freedom. In the first article in this series we | | | | want to build wealth faster, you're going to have to |
| looked at taking control of your current situation. | | | | take some risks. There are three ways I see of doing |
| Controlling your spending, controlling and eliminating your | | | | this: one is to start a business; two is to invest in |
| debt, and starting a savings plan - all so you can have | | | | property; three is to invest in stocks and bonds. In the |
| a firm foundation to take the leap to financial freedom. | | | | example we're working with we've set aside $3,000 to |
| In this article we're going to look at some simple | | | | do this. On the one hand it's not a lot of money - it |
| strategies to go from financial control to financial | | | | won't go far in stocks or in property. On the other |
| power. | | | | hand it's a third of our savings and that's a big risk. But |
| Step Five - Save and Prosper | | | | if you worked through step one in the first of these |
| We touched on this in the first article, but for different | | | | two articles you'll have a better understanding of |
| reasons. Now we're moving on to building wealth. A | | | | yourself. You'll be able to work out for yourself what |
| major part of your strategy has to be cash. Cash is | | | | kind of risk you are prepared to take. Because believe |
| the only true financial wealth, so you need some. You | | | | me this step is risky. So you might decide to just |
| need a lot. Now you have cleared your debts and you | | | | continue saving, that's fine. You are now in control and |
| have your spending under limits, you have some spare | | | | hey - that's a lot of freedom in itself. Or you might |
| cash to save. Find the highest interest account you | | | | decide that you can stand the risk of losing that $3,000. |
| can and start depositing regular amounts. Each month | | | | If you do, then you'll probably have a clear idea of how |
| put as much into your account as possible. Set up an | | | | you want to risk it. The only advice I'm going to give |
| automatic payment to go from your salary account. | | | | here is to make sure you plan it. Have a plan for your |
| Set yourself a target, let's say $10,000 and go for it | | | | investment, do your research, don't get lured by |
| with all your effort. | | | | 'get-rich-quick-for-no-work' schemes, set a limit to what |
| Step Six - Split Hairs | | | | you are prepared to lose - and stay disciplined and |
| When you've reached your savings target you need | | | | focused. |
| to start getting creative with your money. Our example | | | | Step Eight - Plan to Enjoy |
| target is $10,000 so the way we're going to get | | | | This isn't so much of a final step, as something you |
| creative is by splitting it three ways. First we're going to | | | | should be doing all the time in all areas of your life. |
| find another highest interest possible account and | | | | People who plan and set goals and have timescales |
| transfer about $4,000 into it. This is going to be your | | | | for achieving things have more failures and more |
| emergency account. In reality an emergency account | | | | setbacks than those who don't make plans and set |
| should have the equivalent of about three months' | | | | goals. Yes, you read that right. But the reason they |
| salary in it; and you never touch it, unless it's a genuine | | | | have more setbacks is because they are doing more, |
| emergency. Next, put $3000 aside for investing (see | | | | they are always moving forwards, they are never |
| step three). And the remaining $3,000 stays in the | | | | giving up. And the bottom line is that they achieve |
| savings account, where you keep adding to it. | | | | more than those who don't plan. So set goals and put |
| Step Seven - Speculate to Accumulate | | | | plans in place. |
| High interest bank accounts are fine and they're a | | | | |