The habit of earning more - Deepstash

The habit of earning more

It is natural to earn more over your lifetime. But a person can only earn more if they learn more. Further education enables an individual to provide more value.

Earning more is like a habit. Every year, we learn new skills and ways that will increase our earning potential. What matters is making progress, not the amount of money you make.

MORE IDEAS FROM Earn, Save, Invest: 3 Rich Habits for Life - Darius Foroux

The key to the habit of saving is to save a bigger percentage the more you earn. When you start, you may only be able to save 10% of your income, but it is a mistake to commit to the same amount if you earn more.

However, it's a losing game to only focus on saving money. Life is too short to only focus on every penny you can save.

Consistent investing is essential. Investing as a habit will pay off in the long run.

It is most important to start with earning more, then saving more, then investing. People want to skip the first two steps and day-trade themselves to wealth, but most will only lose money by chasing quick money-making schemes. In the end, building wealth boils down to good habits.

How to get wealthy

You don't need to earn a lot of money to become rich if you have healthy financial habits.

If you want to get wealthy, you need to consider three things:

  1. Earn
  2. Save
  3. Invest.

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RELATED IDEA

Jamie DIMON, CEO OF JP MORGAN

”Investing should be a permanent thing. Save, invest. Save, invest. Guessing at market tops, market bottoms – that is a complete loser’s game. I’ve never seen anyone win at it. The smartest investor in the world, Warren Buffett, would say that is not the way to invest.” 

A Definition of Personal Finance

Personal finance is about managing your own money - how much you spend, save, get into debt, and invest.

How you manage your money will depend on your age, education, ambition, family, and country of residence. While this guide will give you enough input to work out a strategy, you should always consider your own personal situation.

Is a myth you can only invest if you have lots of money. Investing is not a goal, activity, or task, it’s a habit. It’s something you do regularly, just like you work out, meditate, read or anything else that takes time to yield results.

ex: If you invest $500/mo in the S&P500 (an index of the largest US companies) you will get to $1M in 35 years. The S&P500 grows 8% a year on average and it compounds over time.