Do you want to be a millionaire? That is possible. Are you willing to make changes to help you move closer to becoming a millionaire? Read on.
We already know that investing is the key to financial freedom, the upside is that most of us still make financial mistakes when it comes to investment decisions. The fact that the first rule of money is to never lose money makes us guilty when we do. The truth is if we look back and see all of our mistakes, we will realize we would have been closer to being financially free if we avoided those mistakes.
Statistically, an ideal age to become a millionaire is the age of 62, and anyone who isn’t a millionaire at age 20, shouldn’t panic, or beat himself up. $9000 is the average net worth of folks that are in their 20’s.
For anyone who is a millionaire in their teen, a lot of factors have been in place to help them accomplish this feat. They may have found themselves in the right place, with the right people, coming up with the right idea, and they work hard on those factors to get there. It’s not mostly out of luck but as a result of the right decisions taken at the right time.
However, if you are not a millionaire in your teen or twenties yet, you don’t have to worry, you have the opportunity to start now, and build from the ground up. Wealth is built in a gradual process, and you’ve got to do that while avoiding certain financial mistakes on the way.
Here are the different financial mistakes you should avoid if your goal is to become a millionaire.
Pay attention to your mortgage rate.
If you are getting a house worth $500,000 at a 3% interest, with a down payment of 20%, you should pause and think. Can you get the same house at a lower interest rate? Or can you invest the 20% down payment in an investment account and gain returns in the next few years? Think it over, before you make rash decisions while considering getting a house. If you need to purchase a house, a 1% interest rate will be okay as compared to 3%. Look for lower interest rates or send your money to an investment account.
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Pay attention to your look
Yes, the way you dress is the way you will be addressed, so take care of your look. If you walk into the bank looking haphazardly dressed, the tendency to have your proposal accepted is low as compared to if you’re neatly dressed. You might even be able to work out a better interest rate for a house or a business loan if you are good-looking.
You always have an option
Life comes with choices, that’s something you should not forget in a hurry. You have the choice to save money today, for the future, you have the choice to decline. You have the choice to get that skill, that education, that certification, anything. It is left for you to decide where you will focus your time, resources, and attention. This goes hand in hand with your finances too, if you want to be financially independent at a certain age, you have the option to watch your spending and learn where your money goes. So you can re-channel it to where it’s supposed to go for your financial future.
Borrowing money to start a business
Yes, you must have a good amount of capital to start your business, but if you don’t know how to manage funds, borrowing money to start your business is a bad financial decision. Avoid it. Once you know how to use funds to solve problems to make more money you can consider taking good debts. Bad debts aren’t for you as we speak, no, you should focus on creating value with the little funds you have available.
Stop trying to time the Market
For most people, who have put in a lot of work learning the market, they can go right ahead and time it, get in and get out. You are just starting, it’s better you stick to compounding than timing the market for huge gains. It’s likely to end with huge losses. Remember, the first rule of money, you shouldn’t be caught losing it.