There is no such thing as easy money, or free money, unless you happen to win the lottery. No matter which career or business you choose, you will have to put in the time and effort to be a success.
But there is a way to Create a Second Income through investing as recommended by Robert Kiyosaki and Warren Buffett. Some of the steps to accumulate wealth and create a second income are below:
- Get a job only if you cannot do anything else. This is the worst way to make money. But if you do not have a choice, start here, control spending and save money for the later steps.
- Start a part-time business that gives you a residual income and does not need as much capital as traditional businesses.
- Accumulate wealth over time by setting yourself clear savings targets.
- Invest to create a second source of income.
- Keep working till such time as your second source of income is equal to or greater than your lifestyle expenses.
- Spend your money wisely so that you keep more of the money you make and remain wealthy for life.
5 Principles of Investing
1. The earlier you start, the better
It is often said that the earlier one starts investing, the better it is to grow your money. As with anything else in life,investing also benefits with an early start. The principle of compound interest works magic on building money. When you begin your career it is understandable that the initial salary will be low. However, even small amounts of savings in good investments will help in slowly and steadily building your wealth.
Another way to build your wealth is regularity and discipline in investing. Often, a break in investing plans disrupts your goals and hampers the growth of money. The best way to make sure you are not irregular in saving is by starting capital and returns guaranteed Regular Investment Plans.
Try and automate this so that you do not forget your monthly investments. Also, if at any point, you happen to miss investing in a particular month, make up for it in the subsequent month by investing double the amount. You must also look at raising your investment amount gradually, as your income increases.
2. Invest for the long-term
Often, people complain that despite being regular in investing, they do not see a growth in wealth. This is because they withdraw the money invested frequently, not giving it a chance to grow. Remember that the longer you leave money invested in a good investment option, the higher it will grow due to the compounding effect.
3. Trying to time the market can cost you
As you can see from the chart below, people who try to time the market lose money.
4. Get expert advice and keep yourself updated
Don’t try to pull out your own tooth. You can do it but it may cost you dearly if you make a mistake. Use the services of a qualified financial advisor.
However, remember to always do your research before investing and do not follow advice blindly.
5. There are other ways to invest
Regular Savings plans are not the only way to invest. If you have a lump sum amount of money, I can show you how to create a second income that generates a cash income stream for you in as little as 3 months.
Note: You would need at least USD 75,000 for this type of investment. If you do not have this you need to build your savings first.
These simple steps will help you grow your money steadily and systematically. Building wealth requires a dedicated effort from your end, as there is no short cut to achieving wealth.