2006-09-03 21:28:37 · 8 answers · asked by metroguy 1 in Business & Finance ➔ Careers & Employment
Yes. Set aside some of your wages to purchase assets. Assets are defined as anything that reliably puts cash into your bank account, i.e. makes you a profit. Keep doing this until the profits your assets generate exceed your living expenses. This is the point when you are rich, because this is the point when you no longer have to work for someone else to earn a living.
Note that one of the tricks here, is keeping your expenses down below your income, whether the income is from your wages or from the profits generated by your assets. The other difficult part, is knowing how to recognize an asset when you see it.
Warren Buffet is probably the world's best recognizer of what constitutes an asset, based on how successful he has been at consistently finding and purchasing assets. This is called 'investing'.
Also know, that investing and speculating are two different things. Investing uses knowledge to reduce risk. Speculation relies on luck to overcome risk. Sometimes speculation is profitable, but not consistently over the long term (that is, over many purchase or selling decisions). Casino owners are investors; gamblers that visit casinos are speculators.
The knowledge required to be a successful investor is equal parts book learning and street smarts. Successful investing requires both an analytical mind and an understanding of human nature, in addition to a certain amount of imagination and dedication.
If you learn how to invest, and routinely spend less than you earn and invest the difference, you will become rich. To learn how to invest, I suggest studying how Buffett and other successful investors did it. Read about and listen to successful investors, then use their techniques and your creativity to invest the money you set aside from your wages.
2006-09-03 22:07:22 · answer #1 · answered by Mark V 4 · 0⤊ 0⤋
One answer: try to earn more than you typically spend. If you can save even 10% of your pre-tax income in a 401k at age 30, by the time you retire at age 60ish you will be a millionaire. Now granted thats in todays dollars but if you can save 15%, then thats all the more rich you will be. The power of compounding is huge. They call it the rule of 7s in the investment community: every dollar saved invested properly will double every seven years.
Roth IRAs are the best vehicle to retire rich or well off: any money OR gains you contribute is NEVER taxed again. This is a huge benefit but there is a very low cap on the amount able to contribute each year, its 4k through 2007 and 5k from 2008 onwards.
401ks have a much higher contribution limit and also have numerous tax advanges: typically the only taxes due on these are social security and medicare, and they can help lower your Federal AGI for child support or legal judgement calculations. So contribute as much as possible to your 401k if your Roth IRA contribution is maxed out. The current 401k limits are 15k for those under 50 or 20k for those over 50.
Contribute as much as you can to: 1) the employer matching portion of your 401k, then 2) a Roth IRA, then 3) remaining amount of 401k, keep them diversified and don't withdrawl until you are 59. You might not be lottery winner rich but this will ensure you have a VERY lucrative retirement--even a multi-millionaire one.
2006-09-04 04:44:29 · answer #2 · answered by midwestbruin 3 · 0⤊ 0⤋
I've always had the same dream as you have of becoming rich for many years. I've tried it and I'm succeeding a little by little after a couple of years of trying. If you want to become a millionaire you got to struggle a lot ! It does take a lot of skill and experience too.
Believe me its so dam tough. Nothing comes for free and that's what I've learned. Its much easier getting a paycheck working as an employee in some company. But then how much would you get as an employee anyway ? Loll !
2006-09-04 04:48:54 · answer #3 · answered by Bachelor boy 2 · 0⤊ 0⤋
thx 4 2 points
2006-09-04 08:30:35 · answer #4 · answered by irsh 1 · 0⤊ 0⤋
Whe yur dreams starts coming out from yur brain thru yur hand. It makes yur dreams come true.
2006-09-04 04:38:18 · answer #5 · answered by Rohit 4 · 0⤊ 0⤋
by asking question, finding answers most of the time not waiting for others to give you wealth or money.
2006-09-04 04:34:04 · answer #6 · answered by eurometrix 5 · 0⤊ 1⤋
hard work and maybe a little luck
2006-09-04 04:39:56 · answer #7 · answered by ^ross^ 3 · 0⤊ 0⤋
Work harder
2006-09-04 04:33:34 · answer #8 · answered by Sordenhiemer 7 · 0⤊ 0⤋