Everybody wants to be a millionaire. You might assume that you need to have a genius idea patented or to inherit a fortune to make that happen. But by copying the tactics and strategies that millionaires use, anyone can accumulate wealth over time. It’s possible for the average person to start saving and building wealth even on a modest income. Carrying out the right steps and strategies with consistency throughout your life can make a major difference to your overall net worth.
We’ve gathered a list of saving tips that are tested and trusted by millionaires. You don’t need a million bucks to follow them: These are the tips that will make you a millionaire, so you can start with any amount of money. Whatever fits in with your budget and lifestyle will set you on the right path.
Tips and Strategies to Start Saving
- Pay Yourself First: When you receive a paycheck, you might be wondering, “Do I save this first or spend it first?” Well, it turns out that spending first doesn’t lead to great savings. How can you possibly know what to save before you spend? By paying yourself. Allot yourself a spending budget, pay yourself, and then save the rest. You could save 10% or more of your monthly income that way.
- Keep a Simple Home: Be realistic and conservative in the size and style of your house. You can save a lot of money by buying and keeping a simple home that doesn’t have the latest technology and oodles of extra space. Even billionaires keep simple homes sometimes, like Warren Buffet and Carlos Slim.
“Doesn’t an idyllic little home sound nice?”
- Pass on Luxury Items: This one might seem obvious, but the most surefire way to save money is to not toss it down a hole by spending on luxury items. Whether you’re eyeballing the best TV at the store, a sports car, or an in-ground pool, think about what the money saved by not buying these could be used for in the long term.
- Have a Good Credit Score: Something millionaires have in common is that they don’t like to borrow money unless it’s for a good purpose, like starting up or expanding their business. In other words, they use the money for something that will help them accumulate more wealth. By refraining from borrowing money unless necessary, you’ll build a better credit score.
- Make an Investment Portfolio: For this step, you’ll definitely need to have saved some money to get started, but it is a crucial part of wealth accumulation. The best way to grow wealth over time is through investments. You can get started by deciding how much money you can invest and working with a trusted financial adviser. If you can’t pay an adviser, ask at your local bank. Many include an adviser as part of their services.
- Follow a Budget: Millionaires know how to budget and save with well-organized finances. They want to know where their money is going and whether it’s being used well. As such, they give themselves a small allowance and keep a close eye on their expenses.
- Pay With Cash: This one is back to basics and will help out people who have an overspending problem. Pay with cash, not with plastic, and spending will feel more tangible to you. Plus, you’re more likely to stick to the budget when you physically can’t overspend.