Contrary to popular belief, there is no fabled pot of gold sitting and waiting for you to come and claim it at the end of the rainbow. Unless you’ve won the lottery or you have a trust fund, it’s doubtful that you’ll make money through luck without any actual effort. You might hang those lucky horseshoes or Celtic cross or scour each clover patch you come across for that four-leaf clover to invite luck from those Irish traditions, but sometimes, especially when money is involved, you have to take steps to create your fortune. The following quick tips may lead you to your wealth, so you don’t need that pot of gold.
Tip One – Prioritise Building an Emergency Fund
It seems that bad luck runs rampant while good luck is tough to find when it comes to money. An unexpected injury, surprise bill, a car that broke down, or school fees can quickly add up. This is especially true if you don’t have an emergency fund to fall back on. The purpose of this fund is to put you in a better financial position to handle all of those curveballs life seems to love throwing at you without going into debt or setting your plans back.
You should aim to have between three and six months’ worth of living expenses squirrelled away in your emergency fund, but even a month or two of expenses will help. To maximise your money, you’ll want to put it in a money market or high-yield savings account. These accounts give you a higher annual percentage yield over traditional savings accounts. So can you make more money by just picking one of these accounts and allowing it to sit? Yes! It’s like reaching into your pocket and finding a $20 bill.
Tip Two – Learn to Budget and Stick to It
Unless you’re someone who is swimming in money, learning to budget, creating one, and sticking to it can help you grow your money. Whether you go with the envelope method, use the 50/30/20 rule, or decide on an entirely different budgeting system, it all starts with creating the budget. You want to list your monthly expenses, including rent or mortgage, food, utility bills, debt, and any other bills you regularly have. The goal is to spend less than you make each month. So, if you’re spending more than you make, take a hard look at your finances and see where you can cut costs. For example, you could eat out less or cut a few streaming services if you don’t use them.
Tip Three – Invest Very Wisely
If you’re dabbling in the stock market like you’re a high-roller in Melbourne, you’re most likely doing it very wrong. There is strategy involved in day trading, to an extent. However, it has a much higher risk of losing money than learning how to invest correctly in long-term stock options. Think about ways to make these smart investments. Start investing in employee-sponsored superannuation instead of relying on volatile stock options. If your employer doesn’t offer it, see what long-term retirement plans they offer and invest in one. Many companies will do a company match between 3% and 5%, based on what you put in. No matter which investment method you choose, take steps to diversify your portfolio to build your wealth.
Money won’t magically appear if you don’t do the work and lay a foundation for a solid financial future. So if you’re overwhelmed or don’t know where to start, get in touch with your Financial Adviser.
General Advice Warning:
The information in this App is provided for information purposes and is of a general nature only. It is not intended to be and does not constitute financial advice or any other advice. Further, the information is not based on your personal objectives, financial situation or needs. You are encouraged to consult a financial planner before making any decision as to how appropriate this information is to your objectives, financial situation, and needs. Also, before making a decision, you should consider the relevant Product Disclosure Statement available from your financial planner.