How to Get Rich Slowly

Tired of get-rich-quick schemes that never work? Sick of hearing hype about how you can earn millions while you sleep? Tempted to play the lottery? Let's get real. For the vast majority of America's millionaires, it did not happen overnight. The first-generation wealthy in this country know that to succeed, you have to work hard, make sacrifices, and be smart with your money. Here are some ideas to help you learn how to get rich slowly.

Instructions

Difficulty: Moderate

Get Rich Slowly

1. Learn to budget. Each month, spend your money on paper before you spend a dollar out of your accounts. You'll learn how to get rich slowly if you know where all your money is going and allot categories for saving and investing in addition to living expenses.
2. Avoid credit cards and excessive debt. Credit cards can lead to a spiral of debt. Avoid that by never opening credit cards and paying off (and then closing) any open credit accounts you have. Save up enough of an emergency fund where you can feel secure without a credit card in your wallet.
3. Live on less than what you earn. This simple rule by itself, if followed, will make the most difference in your finances.
4. Save for emergencies. Build up a liquid savings account to tap into in case of emergency situations where extra (non-budgeted) money is needed, such as accidents, health crises, income loss, etc.
5. Invest wisely. Look for mutual funds that spread your risk over a large number of stocks, funds and indexes. Avoid sinking all of your money into one thing. And the bottom line ... if you don't understand it, don't invest your money in it! Learn more until you know what you are doing.
6. Increase your income (but keep your low-cost lifestyle). A raise doesn't help you to get rich slowly if you spend it all on things you don't really need. Work hard at your job, look for promotions within your company and keep your skills sharp. Consider adding a part-time business or side job to bring in more income if needed.
7. Protect your assets. Cover yourself with enough liability, health and life insurance to protect your assets and family from income loss, disability, and lawsuits.
8. Buy bargains. Avoid paying full price whenever possible. Search used book sales, consignment shops and other sales to get the most for your money. Use grocery coupons combined with supermarket sales to get the lowest prices on food. See Resources, below, for a great coupon source.

Tips & Warnings

• Be patient and live frugally. You will see your efforts pay off over time as your debt decreases and savings increase.
• Avoid taking on new debt, other than an affordable mortgage with a big down payment.