How The Average Person Becomes Wealthy
Not Everyone Is A Trader
For many, the long-term investment approach is the only viable option. The average person simply doesn’t have excess capital to begin making large investments, especially now. Apart from that, there are those who realize that they don’t have significant knowledge in order to begin trading and are smart enough to own that reality and so look to alternative means. Perhaps, if time was not an issue, they could begin “learning the ropes”. However, for many, life is already far too busy. This is where the average person, with little to no market knowledge, is able to outperform the majority by implementing a few basic principles over time. As time passes, these principles become habits that ultimately create wealth.
Hand-To-Mouth
The majority of society lives hand-to-mouth. All income is considered disposable income and as a result, savings don’t really exist for many people. When I speak of becoming wealthy, I am speaking of a scenario where, if you were to lose your income, you would still have significant "income" to survive for years into the future. Wealth is ultimately a form of financial strength and security. There are many “rich poor people” as well, these are those who earn enormous salaries but mimic those living hand-to-mouth. In other words, even though their income is fairly high, it is also considered disposable, which leaves them with nothing saved. If they were to lose their jobs they would be under immediate pressure to find an alternative income source in order to sustain their livelihoods. Unfortunately, there are those who are simply unable to save, as their expenses are already ahead of their income.
The Side Hustle
Many full-time employed individuals take on a side hustle with the key objective being to save money. Something that doesn’t require too much of their time but can still add a meaningful amount to their savings. There are so many options one can choose from, but here in the Crypto world, we are especially spoiled for choice. To be an effective trader takes a lot of time and experience. It’s not something that happens overnight. That is why I say many choose alternative ways, even if they are into Crypto.
Scheduled Allocation
Those who go on to have some measure of wealth in the future also set aside a small monthly amount for some sort of investment or saving strategy. This is simply a disciplined amount each month that they choose not to touch, but rather leave to build up over time. Having “scheduled” investments is a good idea, as they go off without your awareness. You may indeed forget about some of these scheduled payments. This can actually be something that works in your favor, especially over the long term.
Dividend Paying Shares/Staking
Having investments that not only grow in value but also provide an additional income via dividends or staking rewards is another way the average person slowly builds beyond the status quo. For those involved in Crypto, staking is a good alternative to dividend stocks. However, I am speaking of traditional POS and not the “staking” of assets on different platforms and DeFi protocols. Those are obviously also an option but the risk does increase significantly, as is quite clear to anyone watching the Crypto market over the past few months.
Living Within Your Means
This is one that not many are able to embrace and execute. The majority of society is living way beyond their means. Their debt to income-ratio makes it very clear. In my country, citizens are spending up to 75% of their income on debt repayments. This obviously includes mortgages and vehicle finance. However, there are still numerous expenses that require attention. Food, clothing, health insurance, vehicle insurance… and the list goes on. Even if you are only able to set aside a small additional amount by avoiding unnecessary debt, it really adds up over the years.
Final Thoughts
As I mentioned earlier on, this is about creating a level of wealth that is able to act as a significant buffer and not necessarily purchase mansions and sports cars. I don’t think many people can get that right by utilizing these methods. That being said, if you are investing in a bunch of future altcoin gems, you stand a decent chance. Thanks for stopping by. Hope to see you in the next one, soon!
Disclaimer
First of all, I am not a financial advisor. All information provided on this website is strictly my own opinion and not financial advice. I do make use of affiliate links. Purchasing or interacting with any third-party company could result in me receiving a commission. In some instances, utilizing an affiliate link can also result in a bonus or discount.
This article was first published on Sapphire Crypto.
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