Often confused with the other, making money and growing money are two different terms. To earn money, you need competence and skills. Whereas to grow money, you need a bit of frugality, a good comprehension of investment and equity, some savings and some luck sprinkled within. In this blog, we will teach you how to grow money. Put on your learning hats, and read on!
1. Be an early bird to catch the worm
Investments take a significant amount of time to grow properly. Therefore, best investment advisory services will always tell you to invest early. Assuming you want to save INR 5,000 per month and wish to retire at 60 to enjoy life, you’ll need to save a lesser amount if you start investing at age 20 than age 30.
2. Learn to be debt-free
Debt is the quicksand for anyone learning how to grow money. You try and struggle by getting more debt to clear the current debts, but you keep getting trapped deeper and deeper. Make a habit that no matter what you do, you won’t take up any debt. Most investment advisory services will tell you to keep two things on priority -
Pay off all your debt from credit cards which includes due payments and any loans.
Ensure you don’t take up any debt unless it becomes way too necessary.
Don’t begin investing if you’re burdened with heavy debt. Once you are free of your debt, you should focus on piling in cash to meet your immediate needs. Only when your needs are met, you can put a foot in investing.
3. Switch investments according to priorities
As you age, your priorities begin to change too. A person in their 20s is mostly concerned with the clothes they wear and how to have more fun in life. They wouldn’t think of consulting a stock advisory company in Mumbai or their city.
In your younger years, you may try to invest in high risk-high return investments. But as you grow older, you may want to take up a conservative approach to investing with lower risks to save what you’ve earned.
4. Consistency is key
Set investment goals and familiarize yourself with the market trends. The reason why most people fail in investing is that they begin to incorporate their emotions with investing. Oftentimes, we become so aggressive for a new venture but start losing interest within a span of weeks. This is similar to the case when we start aggressively learning a new language or working out. Sadly, attitudes like this lead to loss of hard-earned money. Try to diversify your portfolio and try to own several assets like stocks, funds, and bonds. This keeps you safe from market fluctuations, consequently, lessening your tendency to cash out on an investment.
5. Create a side business
Budgeting helps you gain complete control over your finances, making you spend less and pay yourself more. But, consider this, what if you can earn more? You can earn a lot more if you begin a side business or start a part-time job. Some jobs are flexible enough to be taken upon as you invest. There are several jobs to consider such as web designing, freelance writing, graphic designing, online tutoring, and so on. With your budget built around your primary means of income, that is investing, the rest can go directly into your savings.
6. Put your feet in to check the waters
To learn investing, you need to learn to put your fears aside and start somewhere. Nothing at risk can sometimes mean that everything is at a risk. A lot of people confuse investing with saving. But it’s not! You might try to keep your money saved through a savings plan instead of investing it, but this may lead you to get outrun by inflation.
7. Get expert advice
It’s okay to be skeptical about your own expertise when it comes to investing. If you’re feeling a bit out of the water, getting professional advice is the way to go. Allow a financial advisor to have a look at your budget, goals, and investment appetite. This will help you figure out an investment strategy.
If you’re wondering when to start your investing journey, now is always a good time! These were some tips on how to grow money. Remember, it takes discipline more than strategy to earn financial freedom.
Also Read: Importance of Early Investing