Did you know that you don't have to invent a revolutionary product or invest
in a lucrative penny stock to become a millionaire while these are past that
most of us know many millionaires built their wealth solely from nurturing good
financial habits and making sound financial decisions sure even an average
person like you or me can snowball their net worth and hit the coveted
millionaire status but it does take work this is why in this video i'll be
sharing with you three steps anyone can use to become a millionaire step number
one establish a frugal lifestyle setting up a frugal lifestyle involves
downgrading your living standards despite a robust financial standing this
doesn't necessarily imply ditching camp inside a van to save on rent
far from it frugality is the equivalent of walking a 20 minute distance instead
of taking an uber or halting your tv subscription because you rarely watch tv
anyways see being frugal shouldn't deteriorate
your lifestyle in any way or act as a large inconvenience if anything setting
up a frugal lifestyle is the key that opens new financial opportunities for
you it helps you save money boosts your net worth and helps you ward off the
financial stress of sustaining an inflated lifestyle however this is
easier said than done while the idea frugality appeals to the masses it's
only a handful of people that understand how to tackle it because when everything
seems necessary and convenient how do you draw the line between what's worth
spending money on and what isn't this is where money dials come in money
dials are simply things you're willing to spend guiltlessly on after
eliminating or cutting back massively on stuff you're unattached to these are
things that bring you incredible value for your money and you wouldn't mind
dedicating a significant fraction of your budget to cater to them as expected
money dials vary from person to person well one person's money dial might be
traveling another person can readily strike off traveling expenses without a
second thought similarly someone else may be so fascinated by cars that they
would rather forego flying first class and maintain their vehicles in the same
way it's essential to identify your money dials if you bagged a fifteen
thousand dollar windfall what are the first three things you'd spend it on
whatever your mind captures within the first few seconds is your top money dial
so what business do money dials have on your roadmap to becoming a millionaire
when you make your money dial the focal point of your expenditures you spend on
what truly matters to you you'll find it easier to get rid of unnecessary
expenses to provide enough elbow room for other living expenses most
importantly you'll spend on things you naturally love without feeling guilty
since you've sacrificed a lot of things to do so this can do a number on your
whole budget having identified your money dials and downsized other facets
of your expenses you significantly minimize money wastage plus more
disposable income puts you in a great position to save and invest more money
figures add up quickly and just by shrinking your expenditure by a thousand
dollars every month you can rack up a whopping twelve thousand dollars
annually this isn't small money more so when invested in a market that
capitalizes on compound interest according to the rule 72 an investment
that pledges a nine percent rate of return will take eight years before it
provides double the invested money so at a rate of return of nine percent twelve
thousand dollars transforms into twenty four thousand dollars every eight years
if you consider the fact that you'll be topping up this money every month you
can crack how easy it is to become a millionaire however without
consequential budgeting your efforts will hit a wall tracking your expenses
and laying down a budget is the surest method to evaluate what you're spending
money on conventionally the 50 30 20 budgeting rule rings true this budgeting
rule recommends spending 50 percent of your disposable income on needs 30 on
wants and putting 20 percent towards savings when you apportion your spending
this way it's easier to seal cracks in your wallet and shift the mismatched
funds course fortunately technology has made the
budgeting process faster and painless as you key in your daily expenses budgeting
apps conjure up a visual version of your costs this is usually in the form of
graphs and pie charts outrightly a visualization of your expenditures is
easier to crack and digest this makes it a good way of unveiling what you spend
the most money on once you're done with this step you're ready to proceed with
the next one one massive advantage of setting up a frugal lifestyle is that
you're not susceptible to lifestyle inflation even if your income increases
step number two acquire or build a reliable stream of income the second
step you should follow to become a millionaire is to acquire a reliable
income stream and indeed one hallmark of millionaires is that they have sources
of income they can depend on not one not two but seven streams of dependable
income that's right the average millionaire has money rolling in from
seven different directions now you see why they're always ahead of ordinary
people when it comes to their finances while carving out seven sources of
income is a long shot for most people you can start with one the thing is
building steady sources of income is the bedrock of attaining financial freedom
luckily these income sources can be anything under the sun as long as it's
legal of course a traditional job for instance is the
main stream of income of most households although fitting in popularity a monthly
salary position offers immense income security so as long as you show up to
work and match up to your employer's expectations you're sure to have money
entered into your account every two weeks if you choose the right career
path this is going to be good money too careers such as software engineering can
net you hundreds of thousands of dollars a year and if you adhere to a frugal
lifestyle there's no way you'll be unable to save and invest part of it but
unless you fancy yourself as sherlock holmes in your field earning this much
from your job may be tough which will require you to add on other streams of
income you'll have to explore more options for minting the dollar passive
income is the most feasible option since it only requires a minimal time
investment in this case your payment is not contingent on the amount of time you
spend on a task passive income streams include dividends earned from holding a
company's shares or the interest that accrues when you save through a money
market fund other examples include selling products through online stores
earning rental income or earning royalties from a product you designed
with an online store for instance customers can make purchases even as you
sleep at night once you overcome the hurdle of setting up the website and
viciously promoting your offerings you'll be collecting payments on the
regular by putting your eggs in different baskets in this manner you'll
be better cushioned against income loss suppose this fading pandemic has taught
us anything it's a fact that nobody is immune to the heavy financial beatings
of economic downturns you could lose your job or have your business on life
support when a recession hits when it happens make sure it finds you standing
on the right foot with at least three income streams i'm sure you'll find a
way to pay your bills and sustain some of your investments as you figure things
out even better without getting entangled with debt remember that
becoming a millionaire will require you to have at least a thousand dollars
every month to invest so whatever you do make sure your additional income sources
can generate at least this amount of money this is because investing a
thousand dollars every month for the next 20 years will make you a
millionaire so depending on your current age you can adjust this amount to
coincide with your financial goals if you intend to retire sooner brace
yourself for the sacrifices you're about to make the sooner you plan to retire as
a millionaire the more you will have to invest
speaking of investing what's the best way to tackle it step number three set
up an automatic investing system automation is a sweeping wave and the
financial world isn't lagging behind today many financial bagwigs swear by
automated investment systems as the answer to streamlining finances
similarly putting your savings and investments on autopilot will benefit
you tremendously as mentioned earlier you'll need to set aside a minimum of a
thousand dollars a month at a seven percent rate of return if you want to
retire a millionaire if you're wondering how i arrived at that i simply used a
compound interest calculator compound interest is simply interest earned on
interest when you invest money it accrues interest which increases the
principal amount over time this new principal also accrues interest at the
set rate of return and with automation the thousand dollars will seamlessly
slide into your investment account without passing through you if your
financial discipline is shaky this is the surest way to uphold the culture of
saving and investing technically it's impossible to spend what you don't have
so once you invest your money first before anything else you're sure that
you won't withdraw it and spend it on things that bring no value but even with
an automated investment strategy what are the best investments you can use to
grow your money obviously the stock market is a breeding ground for many
millionaires and may be one of your best bets if you're still in doubt use tesla
as an example over 10 years tesla's market value has blown by more than 3
600 percent this means that an investor who bought a thousand dollars worth of
tesla stock in 2010 would be worth roughly 36 000 as of today similarly you
should identify a list of companies that have great potentials for growth if you
find it too risky to invest in one company you can opt for index funds and
invest in a portfolio of stocks that track a particular index not to mention
investing has become much easier through the use of robo advisors with robo
advisors you don't have to worry about spearheading the investment process they
are automated invested aids that use computer logarithms and financial
software to guide you on how and where to invest the good thing is that unlike
traditional portfolio managers robo advisors demand very minimal
requirements and with high degrees of accuracy as i conclude this video i want
to reinforce the importance of investing your money instead of saving it are you
familiar with the term of inflation this refers to when the purchasing power of
money diminishes due to sloppy economic conditions in 30 years for example a
million dollars will have less buying power than it has today this means that
if you save a million dollars for 30 years in a savings account that yields
no interest you will have less money although the
face value seems to be the same therefore prioritize investing in funds
that increase your cash and protect it from inflation in fact if you really
want to take your investing game to the next level then you need to learn to
invest like the rich because trust me they invest very differently than you
and i so click on over and let's get started