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Wealth is defined as the value of everyone you own minus any debts. A wealthy person is described as someone who can live comfortably for a least 5 years without working. Not everyone during his or her lifetime may become wealthy but you can become financially empowered. Financially empowered is being in control of your finances, spending your money responsibly, buy needs more often than buying wants, and setting goals for your future.
Here are 5 ways to become financially empowered:
1. Become a homeowner. Becoming a homeowner increases your credit score, proves that your are a responsible spender, provides a tax write-off, increases your financial worth, provides you with an asset that will appreciate over time which will provide you with equity.
2. Buy insurance. Buy health, life and disability insurance. Many people get in debt from medical costs because they do not have life insurance. Life insurance is critical because medical costs increase by 10 to 20% each year. Disability insurance (short-term and long-term) will help you in the event you become seriously ill and have to be off work for an extended period of time. This will help you to recover because you will not have to worry about how your bills will be paid during this time.
3. Start a business. Find out what your passion is, what you love to do more than anything else. You will not become financially empowered by working for someone else unless you were one of the lucky people who bought tons of stock while working at Target, Wal-Mart of AOL. Do your research before starting your business and take baby steps. Start your business in your home; there are many tax write-offs for home based businesses. Once you generate enough income then get a loan to open your own office. Get the book Rich Dad, Poor Dad by Robert Kiyosaki.
4. Purchase investment property. All of the financial experts, millionaires and billionaires have talked about it. They all have the same thing in common. They all own investment property. If you are not sure how to begin, do your research, buy two or books on buying investment property, join a real estate group, listen to financial investment shows and find out the best way to get started. Investment property generates cash flow that can be used to generate wealth and allows more opportunities to become available to you.
5. Plan for your retirement. Many Americans today have to work past retirement age because they have no savings or retirement. When a person looks at their life to see what they have accomplished, it is sad to say that they have nothing to show for it. Many still owe money on their homes, don't have any savings and have little or no money in a retirement account. You worked all of your life for what, to pay bills. That is not how life is supposed to be. You should work hard, enjoy life, retire, and then really enjoy life.
