Friday, August 7, 2009

Buddy's Tips #004- Steps for Long Term Successful Wealth Building

1. Know your income and spending thoroughly
2. Track your income and spending each month
3. Plan monthly payments 7 to 14 days in advance each month
4. Think out each spending move before you actually make a payment
5. Work hard to pay off all debt. Whenever you eliminate a debt set aside a portion of the money that is freed up for savings and then add the balance to your payment against another bill.
6. If you must buy, do “selective purchasing”
7. Save to “selectively purchase” an item, assuming you have to have the item
8. Set incremental savings goals to attain each month.
9. Likewise set incremental debt elimination goals to free up money for savings and further debt payment elimination
10. Goals setting: Set monthly savings/investment objectives and maintain or exceed them. Monitor your savings program weekly
11. Willingly sacrifice today so that you will benefit tomorrow
12. “Save automatically” using automatic reductions from your monthly salary
13. Give yourself a “raise” periodically and to continue increasing your savings amount each month and maintain it over the life of your savings program
14. Give yourself a “savings bonus” to celebrate accomplishments; thereby increasing your savings for a month or so
15. Give yourself a “small gift or treat or party” to celebrate accomplishing a major savings goal
16. Stay focused, be persistent, and remain dedicated to your goals
17. Be consistent in savings; make savings a “habit”; a regular part of your everyday life
18. Save throughout your entire life
19. Never deviate from your savings goals. Don’t get distracted.
20. Give savings a top priority; always save; “pay yourself first”
21. Use “Tax Deferred Programs” for savings. Set up savings program to pay yourself first each month:
a. use Deferred Comp tax deferred programs
b. use 401 K match programs
c. use IRA programs
22. “Maximize your deferred savings”: Work hard to save the maximum amount you can defer into each of these programs.
23. Use “flexible spending account” for health care, if available to you
24. Savings technique: Use low interest loans or cash advance loans to fully invest in your IRA or 401K program. Work hard to pay-off your loan quickly.
25. Save 75% to 100% of all raises or new job income
26. Invest in real estate for investment growth and tax purposes
27. Formula for Success:
Know your Savings Goal=>
Plan how to attain=>
Track progress=>
Compare success rate=>
Adjust savings program=>
28. If you must shop:
a. Buy clothing and other necessities in the secondary market on-line
b. Buy at Consignment Shops
c. Buy at Garage Sales
29. If you use a credit card, use a “cash back program credit card” to benefit from any spending, but most importantly pay-off your credit card in full each month.