Saving Money Tip #236 - If You Are Trying to Increase Your Wealth, Do A Bit Of Everything. When trying to build up your wealth, you can try to learn about investing in hopes of being the next Peter Lynch and beat the stock market. Or you can try to be the biggest miser and live in a dark room eating beans and rice and using five squares of toilet paper per day. Or you can go out and get an extra job in hopes of bringing in more income. You can do only one of these things and hope that you become rich. But in reality, very few people become the next Peter Lynch because it’s really hard to beat the market all of the time. And living in a dark, cold room really isn’t much fun. And working hours upon hours at your job doesn’t leave a lot of time for pleasure. So what is the best way to grow your wealth?
I believe it is to do a bit of all of these things – not just one. Take the time to learn about investing. Learn what the different investment vehicles out there are. Read a few financial books about growing your money. But make sure you don’t “play” the market like it is a game. Make wise investment choices. Take on some risks where it makes sense but balance it with conservative savings as well. You won’t have to worry about beating the market as long as you are getting the appropriate reward for the amount of risk you are willing to undertake. This will help increase your wealth.
Put in a few extra hours of overtime at work if you are able. Or find a job to do after work a few evenings a week. Or perhaps learn to sell on eBay or sell crafts that you make in your spare time. These are great ways to increase your income. As long as work is not taking over your life and you have time to enjoy things you like to do, then this will help increase your wealth without sucking up all of your time.
Cut down on extravagances. Try buying generic brands, using coupons, and purchasing used. Research before you buy. Make more food from scratch. Eat out in restaurants less often. Going all out and being miserly shouldn’t be necessary unless times are dire. But decreasing your cost of living is a step in the right direction to increasing your wealth.
By partaking in many different methods of saving or growing money, you will in fact increase your wealth without going to extremes. Learn about investing, increase your income, and decrease your costs and you will be on the road to increasing your wealth without putting extreme pressure or sacrifice in one part of your life.
In Real Life (IRL) – There are people who spend a lot of time studying stock pages, investment newsletters,and listening to financial gurus in hopes of becoming one of those who strikes it rich in the stock market. While I see the value in higher-risk investments, I am a bit too conservative to put a good part of my money in the stock market. I like to balance out my investments with guaranteed CDs and government bonds.
Because I am not a high-flyer investor, I need other ways to grow my savings. Therefore I have a side job to increase our income. I spend time scouring thrift stores and yard sales in hopes of finding things to sell on eBay. In addition to enjoying these activities, I have been able to add to our family’s income while still staying at home while my children are young.
Because I don’t work my tail off on a 60-hour per week job (well I do, but I don’t get paid for that job), I seek other ways to grow our family’s wealth. And that is by cutting back on unnecessary expenses. We cut back dramatically a couple of years ago on eating out. I have spent the past year or two learning how to bake bread and cook more from scratch. I have learned some couponing tricks. We do our research before we buy things.
Each of these things taken alone can increase your wealth. But by combining all three methods, we are able to increase our savings without living a barebones existence, without putting all of our money in high-risk investments, and without killing ourselves by working all of the time. By combining all of these methods, we are able to cut our risk and enjoy our lives while increasing our wealth at the same time. For other ways to save money check out Frugal Fridays.