Five Tips to Help You Build Your Wealth

1) Own your own home

Home ownership helps you build wealth in at least two ways. First, real estate is an asset with a healthy long term track record. Second, mortgage payments usually help you build equity and are therefore a form of forced savings.

2) Set goals, prioritize and focus

I figured out in the first year of my relationship that if you set goals, prioritize and focus your financial goals are far more likely to be achieved. I’ll repeat this. If you set goals, prioritize and focus, you WILL achieve your financial goals.

3) Invest in stocks

Over the long run, owners come out ahead under our system of democratic capitalism. To get maximum return on your money, you have to have some exposure to common stocks. Why? Making money on the appreciation and on the dividends will help improve your bottom line.

4) Don’t spend more than you earn

This is a no-brainer. If you have £100, but rack up debts of £500 on your credit card, then you’re in the red. Doing this over the long term is a recipe for bankruptcy. But if you got £100 and only spend £80, then your bank account is healthy and you’ll be happier, more in control if your life and better prepared to take whatever financial challenges come at you.

5) Pay off high interest debt

Usury sucks. Many credit card companies are usurious and attempt to engineer you into an agreement whereby your borrowing terms are stacked in favor of credit card companies. Other lenders like payday loan companies do essentially the same thing. In some of the arrangements, the borrower will be forced to pay upwards of 200% or 300% interest on their loans. If you’ve got high interest credit card debt or payday loans, pay them off immediately. Bite the bullet, sell some stuff, beg, do what you have to, but pay these types of obligations off immediately.