Are you a spender or a saver? It goes without saying, everyone wants more money but if everyone knew the easy answer to getting more money, we’d all be a millionaire!
Spending is certainly an easier past time than saving, but how much you manage to save and where you invest those savings will ultimately determine how quickly you could get ahead with your finances, and could be the difference between long term financial freedom or financial sub ordinance.
Take for instance a small investment of $50 per week which for some households may be noticeable, however given the average Aussie wage, should be achievable for the majority and has a huge impact in becoming a millionaire. By investing it into an Index Fund each week, you will very quickly be on your way to some serious dollars. Estimations based off the 8.8% long-term return on the Australian share market could turn your $50 a week to $40k+ in 10 years, $140k+ in 20 years, $380k+ in 30 and by 40 years, that magic millionaire number is in sight. If you then reinvest your dividends as they’re received and allow those investments to tick away, increasing through compound interest, then now we’re really talking serious dosh!
So how do I set aside that $50 per week with ease? The first question would be, have you done a finances health check recently? If the answer is no, then it could be time to grab the old excel spreadsheet out and take a birds eye view of all those credits and debits each week/month, and really determine what ‘disposable’ income you have left after the fact. This can highlight where you’ve prioritised your spending, what’s most important to you or essential, and whether this is bringing you satisfaction. It can also be an opportunity to make some necessary changes to the incomings and outgoings so as to make room for that icing on top to do with it as you please, as referred to above.
My advice? Set up respective bank accounts for each kitty and automate your payments where possible- a set and forget method if you like. It requires some effort in the beginning but once it’s done it makes life that much easier to become a millionaire. And most importantly- each component is a little more trackable.
If you’re finding you just don’t know where to start and need some sound, professional advice, get in touch with GFP today to start gaining clarity on your financial future.