Tuesday, October 29, 2013


Has 2013 not been such a great year for you?  Would you like to be better off by the end of next year.  I've come up with a simple 4 step program to practically guarantee you will end 2014 better off than you were at the end of this year.

Step One:  Pay yourself first.  Everyone has heard of paying yourself first, but very few people do it.  It is the absolute beginning of any wealth building program.  It simply means, when you get paid you pay yourself before you pay any of your bills.  Ten percent of all you earn is a good goal to shoot for, even if you're not able to save that much at first.  Start with as much as you feel comfortable with and build up to the 10%.  I started by saving just $35 per month.  No matter the amount, regular contributions to your savings and investment program will add up much faster than you think. 

Step Two:  Put your money to work.  You can do this in many different ways.  In my case, I invest in dividend paying stocks.  However, you might decide to put your money to work in rental real estate, flipping houses, bank CD's or government bonds.  Whatever investment you decide is right for you, you want to have the money you've paid yourself working for you earning even more money.  

Step Three:  Reinvest your earnings.  Whatever avenue you take to put your money to work, once you've received a payout, reinvest your earnings.  With dividend stocks, reinvesting dividends is simple and commission free, so each month my cash flow grows, whether I make additional cash investments or not.  Reinvested earnings increases the rate of compounding investments, leading to a snow ball effect.  So don't spend your dividends or earnings, reinvest them.

Step Four:  Put your cash windfalls to work building your wealth.  Cash windfalls come in many different forms.  Tax refunds, gifts of cash on birthdays and holidays, lottery or casino winnings, or any other lump sum of cash you receiving on a regular basis.  You may not want to set aside all the money.  I know a lot of people who use their tax refunds to purchase new vehicles or cover other large expenses each year, but you can still pay yourself 10% out of cash windfalls and put that amount to work.  

A persons' wealth does not come from money on hand, it comes from the money you put to work earning you an ever growing stream of income whether you work or not.  It starts out small but will grow ever more rapidly if you stick with the program.  It really is as simple as it sounds and it's really not as hard as you think.  So if you want to be better off by the end of 2014, make a plan of action and start today.  There's no better time than the present.  

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