The 7 best ways to build wealth starting today, according to financial planners


To build wealth, start with the resources you already have, whether that’s access to free high-yield savings accounts or a 401(k) with an employer match.
While starting today is a smart move, financial planners say not to expect wealth to grow overnight — to make real progress, you have to be patient.
Need help building wealth? SmartAsset’s free tool can help find a financial professional near you »

The key to growing wealth isn’t always simply to make more money. Sometimes, it’s about using what you have to your advantage — maybe it’s as easy as moving your savings into an account with higher interest rates, or taking advantage of an employer’s 401(k) match.

Most importantly, experts say one of the most important elements to building wealth is to simply give it time. Here are the best ways to start building wealth today, according to financial planners.

1. Figure out your net worth

Financial planner Michael Pappis says those looking to grow their wealth should start by understanding what they already have

The best way to do this is by calculating your net worth. “Most people have never visually seen their net worth on paper, and it’s usually an eye-opening exercise,” he says.

It’s a fairly straightforward: simply add up your home’s value, any investment accounts you have, bank account balances, and any other assets. Then, subtract any loans or debt you might have, including student loans, mortgages, and credit card debts.

If your net worth is a negative number, it just means you have a little further to go.

2. Start saving automatically

Financial planner Christine Centino says that one of the easiest ways to build long term wealth is to save without thinking about it.

“A lot of places out there right now, like Betterment, they let you automate savings into your brokerage accounts every month,” Centino says. “I think that’s a great way to do it.”

She says that having savings automatically drawn from your checking account, or automatically deducted from your paycheck if you’re saving in a 401(k), is a helpful way to save. “You forget about it, and then it starts to accumulate,” she says.

It’s a no-effort way to start accumulating wealth, and you won’t have to think about it every month.

3. Take advantage of your employer’s 401(k) program

A 401(k) match is a program where your employer “matches” a percentage of your retirement contributions to your 401(k). Not every company offers this perk, but if yours does, you’ll want to take advantage.

“If your employer matches 100% of your contribution up to 4% of your salary, I’d contribute at least 4% to the plan,” Pappis says. “For an easy example, if you’re making $100,000, you will contribute 4% of your salary, $4,000, to your plan, and then your employer will contribute $4,000 to your plan. You’ll save as much as $8,000,” he says.

Pappis says that the younger you start, the more time your money will have to grow. “As a young professional, this annual match …read more

Source:: Businessinsider – Finance


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