When you are building wealth from scratch your ultimate aim is to gain financial freedom.
Financial freedom is when you have-enough money to stop working at your 9-5 job-without affecting your present lifestyle
In other words financial freedom means you have the ability to earn income from multiple sources that does not require your active presence
For most working adults financial freedom is an improbable dream.
A study done by the US Census Bureau showed that only 1% of working adults gain financial independence at retirement.
According to the Census Bureau study 63% of working adults end up becoming dependent on social security. Another 3% of these individuals continue working after retirement.
The truth is that you can gain financial independence. As long as you are determined and never give up on your dream.
The key to gaining financial freedom is starting a plan to accumulate wealth early.
In order to accumulate wealth you must develop the habit of saving, investing at the same time decrease your spending
In fact you should be earning enough income that you can save more than 20% of your income and invest a large chunk of your income
The money you set aside for investing is the single most important element for your future wealth.
The larger the sum of money you can invest in assets that yield higher than average returns on investment-the faster you’ll accumulate wealth
This means that building wealth requires a way to earn a higher than average income. Because you can save enough money for investing
The implication for you when you choose to become wealthy is that you must look at your primary source of income
Why? I believe that your present source of income is important.Because when you are only earning living wages…its difficult to save or have enough money to invest
I want imagine that your source of income represents the engine of a car. You’ll agree that the production of a car depends on its engine capacity. Which means that a car’s speed depends on it engine size
For example A Ferrari will travel faster than a Ford Focus because of their engine capacity. Which means you are more likely to get to your destination faster-when you drive in a Ferrari compared to driving a Ford focus.
In the same way a car with a higher engine output will take you to your destination- the income you earn will affect how quickly you can accumulate wealth
This means that if your present source of income is not moving you towards financial freedom: you must change course
How do you change course?
How do you increase your income?
How can you start investing for your future wealth?
The answer is simple.
You need to retool your income engine. Or look for multiple sources of income to achieve your objective
Before you can make the changes that will increase your income…
I think it’s worth stepping back for a minute and look at your income engine. Your income engine is how you earn money from what you do.
There are 3 parts to whatever income engine you have. That is your job, business or profession
These 3 parts work together to affect your income. In fact they constitute how you add value in the market.
The 3 factors that affect your income are:
- Who you serve: that is your market/customers
- What you serve: that is the services or products you provide
- How you serve: that is location or the channels through which you serve
These 3 factor can affect your the size of your income because of limitations
For example, a dentist’s income is limited because there is a limit to the number of patients.
He can treat in 24 hours. He is also limited to a local area at any given time and not everyone can afford to visit a dentist
On the other hand, a business that has both a website and a physical location has fewer limits on its earning ability. The company can reach customers globally and sell 24 hours a day via its website
Do you get the picture?
When you consider choosing an income engine you must look for one that has no limits on your income
If you are presently stuck in a job that you hate…
Or you feel you have not found your calling…
I will recommend you read a book by a mentor and friend Dr.Valerie Young
If you are looking for ideas on increasing your income engine my friends… at the American Writers and Artists (AWAI) have tons of programs. That can start a side business or build multiple streams of income
You can check all programs available from AWAI here