Increasing your income is the only way to accelerate the process to wealth. You have to have an adequate income and be invested in safe securities. The truth is investing alone won’t make you a millionaire. You must work equally as hard to increase your income. If you truly want to get wealthy, investing is only part of the game. The quicker you learn about the finance world, you’ll soon find out that the interest you pay while in debt is much larger than the interest you can get in investing. When you are in debt, you become the one who has to pay interest. Investing is the opposite of debt, you risk your capital and are paid interest on this risk. This interest compounds over time.Įspecially if you are only making minimum payments, it seems impossible to crawl out. When you are in debt, you are paying the lender interest. If you have a basic understanding of math, you can quickly understand why debt keeps you from wealth. In fact, if you survey millionaires and ask how they became wealthy, you can be sure they won’t give you credit card tricks or secrets. Mark Cuban, the billionaire who owns the Dallas Mavericks, says the fastest way to get rich is to get out of debt. What if the average 25 year old above had started at 20 instead of 25? That person would have $3,947,653. But it’s so possible, especially for the 20 year olds. Nobody talks about that story because it’s boring. That’s a millionaire who had a very average income. That’s a millionaire who didn’t have to start a business or take crazy risks. The average 25 year old who invests $5,000 a year and makes a 10% return would have $2,430,366. The biggest advantage of investing comes from the power of compounding.Ĭompounding interest is like a snowball rolling down a hill, it picks up more and more snow until it’s like an unstoppable avalanche. The best part of being young is that you have so many years ahead of you. Be inspired, and pass it along to a friend. Here are 11 simple tips for those looking for the best financial advice for young adults. But instead of focusing on the excuses, focus on the opportunities. They are inheriting record debt levels and rising inflation, contributing to higher standard of living costs. Young adults need all the help they can get.
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