Key Takeaways
- If you want to build wealth successfully, you need to save first and spend second.
- The rule of thumb when it comes to saving is to save about 15%.
- If you spend first, you can get used to the niceties in life, and then it can be very hard to have to go backwards later on in life when you find you haven’t saved enough.
There’s an ancient Chinese proverb that says, “A journey of a thousand miles begins with a single step.” That certainly holds true when you get your diploma and go out in to the workplace to your first job.
When you are starting off in life, and you want to end up in a place where you’ve built your wealth successfully, you must do something first. It’s really simple: save first, spend second. It is the most important reason people accumulate money and build their wealth.
The rule of thumb when it comes to saving is to save about 15%. You want to do this right when you start off in your work life. Why? Because if you get used to the niceties in life, right off the bat, you may have to go backwards later. Going backward and having to undo things that you get used to can be very tough.
So, you might say, “Hey, I just graduated from college, I’m going to buy a brand-new car and get some great furniture, fancy clothes, and a huge apartment.” And then, there’s no money left. A couple of years later you think, “Gee, I’m not going to make it, so I’m going to have to sell some of these things I bought and cut back on my spending, and now I’m headed backwards.” That’s not fun.
The point is, that first step of that very long journey that you’re going to take, make sure you save first and spend second. It’ll make your journey a whole lot easier!
Until next time, enjoy!
Gary