Did you know how fast you could build wealth if you had no payments, no debts, or much lower bills to pay? So, sit back, relax, and discover ways to stop some financial bleeding so that you can build wealth faster and smarter!
You may be “burning” your hard-earned money, and not know it. When you overpay for something or spend excessively, it is literally like setting your money on fire. The longer you keep overpaying, the more money you are burning. Continuing in this path will undoubtedly diminish your ability to build wealth and retire rich.
To get a feel for what this is, let’s say you are paying $200 per month for a service, while your neighbor is only paying $100 for the same service but from a different company. You are overpaying by $100 monthly or $1200 yearly.
If you switch to the company your neighbor has and start investing the $100 you are now saving, over 30 years (at 10% rate of return), you would be $217,132 richer. Would you rather keep overpaying for a service that does not offer any better service, or would you rather have additional $200K in your portfolio?
Even if you are well-off financially, you’ll agree that it is wrong for businesses to overcharge consumers. When companies inflate prices, it is called “price-gouging,” and it’s simply wrong!
Price gouging is a pejorative term referring to when a seller spikes the prices of goods, services or commodities to a level much higher than is considered reasonable or fair and is seen as exploitative, potentially to an unethical extent. Worst still, some companies lock consumers into multi-year contracts, and charge high early termination fees should they terminate the contract.
Even if you couldn’t care less how much you pay for things, does it not make much greater sense to put your money to better use? Take a hard look at your budget to see where you can cut cost, save, and invest so that you can build wealth faster for your family legacy.
Here are some of the most overlooked expenses where you may be able to find savings:
Reduce or Eliminate Cable Bill
You could find a cheaper way to gain access to your favorite shows if you tried hard enough. Perhaps you could downgrade from premium to basic cable, switch to a company that offers premium services at lower price, or maybe you could even eliminate your cable bill entirely. But if you can’t bear to miss the latest season of your favorite shows, there’s good news: You don’t have to eliminate cable altogether in order to snag decent savings.
“Companies are open to making a deal with you on a lot of bills,” says Dan Rayburn, principal analyst in the digital media group at consulting firm Frost & Sullivan. “I’m always amazed that consumers just don’t seem to realize that if you’re nice and friendly and call up and ask for something, good corporations that value you will work with you.”
Of course, it always helps to be prepared before you try to negotiate down a bill that you’ve likely been paying for a while, so arm yourself with these five expert tips before hitting up your cable provider.
Used Car or New Car? Buy or Lease?
According to Dave Ramsey, you’re better off financially if you buy a reasonably used car. New cars lose 60% of their value in the first 5 years. When you buy used, the original owner had already eaten the cost of depreciation. You, on the other hand, get a great fairly used car below the wholesale price of a new car.
Leasing a car is also a pain in the flesh (financially speaking). “A lease starts a trend of perpetually paying a car payment. If you never paid a car payment and the average car payment in the U.S. was $350 a month, putting that $350 a month in a mutual fund that made 10% would become $791,171 in 30 years” (Heather Levin of MoneyCrashers.com).
Request a Credit Card Rate Reduction
If you’ve got a relatively large balance on your credit card, call up your credit card company and request a rate reduction. If you pay your bill on time every month, they may be willing to negotiate. If they don’t go for it, get a 0% balance transfer onto another card.
The key here, though, is to stop buying on credit until your financial situation is healthy. Use credit cards only for emergencies, and pay them off at the end of the month or as early as you can. Don’t let them hang around like pets.
Homeowners and Auto Insurance
If you haven’t shopped around for homeowners and auto insurance lately, now’s a good time to get a few quotes, especially if your credit is strong. If you can save a substantial amount and maintain your current level of coverage, it’s well worth switching to another provider.
Most insurance companies also offer a good discount if you bundle your homeowners and auto policies together. If you currently use two separate insurers, ask what kind of discount each would offer if you bundled the policies together.
Take-out and dining out can be a nice luxury and huge time-saver for a busy family, but the expense can be tremendous. Instead, look at other options to make dining at home more convenient — for example, prepare lots of meals at once and freeze them for easy cooking later. Meanwhile, focus mostly on simple recipes, and choose recipes that use the fresh produce in season in your area.
Run a Energy-Smart Home
Air sealing your home can prevent drafts — common efficiency culprits in older homes. The loss of cool air in the summer and the loss of warm air in winter can both increase your utility bills substantially.
The hot water heater is a major energy drain in most homes, accounting for about 14% of energy costs. Often, the water is kept hotter than most people ever need, plus the heat is continuously lost to the environment, meaning you have to burn more energy than ever to keep the water so hot. Solve both problems by dropping the temperature down to 125-130 degrees Fahrenheit (around 60 degrees Celsius) and also installing a water heater blanket to keep in the heat – a blanket can pay for itself in about a year, after which you’ll be saving money monthly. While you’re at it, insulate any exposed hot water pipes as well for additional savings.
These are just a few of the strategies you can implement immediately to save money so you can make it work better for you.
Build Multiple Income Streams
The greatest money mistake you can make in your life is to depend solely on one source of income. Listen! Lift happens – sickness, injury, even death. Can you imagine what would happen to your family if you lose just one of your income source? Losing an income source would be devastating to many families, so, prepare for the worst, but hope for the best.
Often people complain that they cannot invest because they don’t have enough to cover their monthly bills. But the reality is that, if you look hard enough at your budget, you can find $100-$1000 every month you can invest. You’ve read about some early.
Investing $500 monthly over 30 years at 10% will make you $1,085,660 richer. Would your children thank you for leaving them a million bucks or would they thank you for leaving them with a mortgage, credit card debts, unpaid hospital bills, tax bills, etc?
What would your excuse be for not leaving a rich legacy for your children? Would they appreciate the nice things you are spending money on now? Would they appreciate you for taking them on yearly vacations, but have no inheritance for them? Think about these things.
Passive income, an essential ingredient for achieving financial freedom, is the type of income that you keep earning from taking a single action. Therefore, adding passive income to your income streams can tremendously accelerate your financial freedom!
Examples of passive income include royalties from music or authoring a good book; earning advertising revenue from your YouTube videos; income from rental properties; and income from network marketing. Learn more at https://maxkingdom.com.
Raise Wise Children
Children are the heritage of the Lord. Wise children are the crown of joy to their parents. Therefore, Teach your children, the way they should go, and when they are old, they will not depart from it. Start by asking God for wisdom.
James 1:15 says, “If any of you lacks wisdom, you should ask God who gives generously to all without finding fault, and it will be given to you.” Without wisdom, it is impossible for parents to teach their children good manners, good work ethics, appreciation for others, values and responsibility.
The world is a very hostile place when children leave the comfort and protection of their parents, they face a tough and challenging world that seldom forgives. If children are not well-equipped, they may fail. The wisdom you impact into your children can deliver them in evil days.
Teach your children the value of money. Let them understand that is okay not to have everything they desire, by saying “NO” to their requests occasionally; and then surprise them with unexpected rewards when they accomplished a task they thought difficult. This will reinforce in them the value of contentment and the benefits of hard work and perseverance.
Your children are your future. Raise them well so they can bring your great joy in your old age. May the grace of God be with you and your home. Amen!