ABCs of Wealth Building

By Pinyo, on February 19, 2008

At the end of last month, I discussed how the basic net worth formula reveals several money management insights. As part of that article, I started a little game where I ask my readers and other bloggers to join in and list idea to increase income, reduce expenses, save money, pay of debt, etc. I kicked it off with:

A

• Ask for a raise — If you know you deserve it, don’t be shy. Ask for it.

B

• Budget – Track your expenses and manage them. Set aside money for savings, for investing, for paying off debt. Plan for it and allocate it so you don’t spend it! Manage your money, don’t let your money manage you. — by glblguy
• Bargain with credit card companies and lenders for better rates. — by Lily
• Barter – non-cash exchanges circumvent the drain of cash. — by David Hicks

C

• Credit cards – Pay them off!!! — by FourPillars
• Change your habits, or Save your spare change. — by Chris

D

• Debt – USE DEBT WISELY. Do not take it on unless you know what you are doing. Yes, wealthy people leverage debt, but MOST people who play with debt drown in it. — by paidtwice
• Do not be COMPLACENT — Take action and expects a reward. No action will leave you worse off. — by Femi

E

• Education — Financial education will go a long way to improving your wealth. It could be learning the basics about money management, how the markets work, the time value of money — by My Dollar Plan

F

• Frugal – Live frugally! — by Emily
• Financial Freedom – by SingleGuyMoney

G

• Goal(s) – It is very important to set monthly/quarter/yearly goals for things such as reducing expenses, reducing liabilities, accumulating assets etc. — by Vikas
• Goal – every formula needs an “answer” i.e. how much are you striving for? — by AJ Cartwood

H

• House – You need to own the house you are living in at some point of time. Being able to own extra houses (assets) is even better. — by Vikas
• Housing – Plan how much house you need and can afford, how best to finance and to repay. — by fathersez

I

• Investments — Without investments in different asset classes, you cannot really grow your net worth. — by Vikas
• Invest – Put money into stocks, bonds, and savings accounts for the future and watch it compound. — by Adfecto
• Interest — Let your money work for you by earning interest. Johnny Carson while hosting the Tonight Show once said, “Scientists have developed a powerful new weapon that destroys people but leaves buildings standing – it’s called the 17% interest rate.” Don’t pay interest; put it to work FOR YOU! — by Adfecto

J

• Just Start – Too often I spend so much time planning, that I don’t put my plan into action. — by Lynnae @ Being Frugal.net

K

• KILL your DEBT – Because it’s hard to accumulate anything when you have to send out so many payments! — by Debt Free Revolution
• Know your limits — by Chris

L

• Live, Laugh, Love — and know what is IMPORTANT to do that and what is just…stuff. I spent a whole lot on my kids and they are worth that and more. I spent a whole lot on bath and body works lotion over the years and um…well…anyway. — by paidtwice

M

• Motivation – by Millionaire Money Habits

N

• Never give up – by unequivocal
• Not Now – Save up for the things that you want and you will value them more. — by plonkee

O

• Opportunities — Seek them out and when they come to you, take advantage of them. — by MillionDollarJourney

P

• Pay yourself first – by unequivocal

Q

• Quit acquiring new debt – You can’t get out of the hole if you keep digging. — by Laura
• Question your financial assumptions – Is homeownership better than renting? is it better to pay off cards and delay retirement investing? etc. — by rocketc

R

• Remember your goals – by unequivocal

S

• SNOWFLAKE!!!! – Pay a little, save a little, here a little, there a little — earn a little more, save a little more… — by paidtwice
• Shrink your debt – by Chris
• Save today and enjoy its reward tomorrow — by Femi

T

• Time Value of Money — Start saving now to take advantage! — by Mrs. Micah

U

• Understand your financial picture – Without understanding where you are, how will you get where you want to be? — by paidtwice

V

• Value yourself — Give your time value, and make sure you are using your resources to further your own values. — by paidtwice

W

• Wait — Wait before acting impulsively, wait before pulling the trigger on a big decision, make sure you know what you are doing and why. Then – act! — by paidtwice

X

• eXamine your exposure to risk – do you have enough insurance? You don’t want one catastrophe to wipe you out. — by jim

Y

• You can achieve wealth – if you set your mind to it and work diligently to achieve your goals. — by jim
  

Z

• Zero out your bad debt – it’s hard to build a house if you start with a hole in the ground. — by jim

Other Tips

• Whenever you purchase any item always as the question “Is that your best price?”. My experience shows that doing so three times during a transaction will almost always result in some kind of discount. Be cheeky rather than aggressive when you do it and the shop assistant will almost always give in. — by Make Friends, Earn Money

Looks like a few letters are missing (thank you to Paidtwice for rectifying that problem) but I think this is a great list. Again, thank you to all the participants.

This article was featured in:

• The Carnival of Debt Reduction – 70s Edition hosted by BeingFrugal.net. For more information please visit the Carnival of Debt Reduction.

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Pinyo is the brain behind Moolanomy personal finance blog and a few other web sites. If you like this article, please subscribe for free daily email updates.

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