Build Wealth through Strategic Thinking
Wealth isn’t something that finds you and settles in. You must have a strategic plan to build it over your lifetime.
That's where a program of frugal living can help.
We've probably all heard that a failure to plan is a plan to fail. It's true in many cases.
For me, the key is to know what you want, then figure out a way to get it. No one is going to hand you it, you have to work for it.
For instance, buying a home in a nice location allows equity to accumulate as the value of the home goes up. Using this strategy, you provide comfortable shelter for you and your family, while at the same time, allowing the home's value to increase. The result is an accumulation and retention of a good portion of the money spent.
Strategic thinking often takes a “long-view” of things. Instead of get rich quick, it focuses on get rich steady.
Techniques are different, but related to strategies. Think of techniques like you would tactics or tools. They are actions that support execution of the overall plan. Money saving tips like buying things second hand are good techniques, but you will never accumulate assets that way – you need a strategic plan.
My strategy after college was to work for one of the highest paying government agencies and make my way quickly up through the ranks, gaining ever higher salary and experience over a 5 year period, then jumping ship to use what I learned to land a higher paying career in private industry. This was my first strategic plan for building my assets.
I did just that, but in only 4 years. I made a 25% increase in salary when I landed my first job in the private sector – that was the equivalent to what my boss’s boss was making in government service. Not bad strategic planning for a 21 year old.
Your strategy should focus on building, investing and retaining wealth. Accumulation of money and tangible assets is important because it provides you with the ability to have many more choices in what you do and how comfortable you will be.
Done with Building Wealth, take me back to Are You Frugal?