Becoming a billionaire requires more than hitting nine-figure numbers. The world of investing and capital is complex and strange to most "normal people", but that doesn't mean there's a barrier preventing you from becoming a billionaire yourself. Committing what little you have to achieve a life of luxury is a classic of American fiction, but you must learn to create opportunities, invest wisely and conserve your wealth to maintain them over time. Read on to learn more.
Steps
Part 1 of 3: Creating Opportunities
Step 1. Study the topic
People don't become billionaires by accident. Analyze as many variables as possible before setting up a plan, such as interest rates, tax rates, dividends, and so on. Take lessons online or at a university on financial issues, read investment books and learn the rules of the matter.
- Study finance and the business sector to learn about the needs of the market and consumers and to develop business models based on these needs. Improving your skills on the hottest topics, such as computer science and technology, is an important way to enter the new media and new capital industry.
- Read biographies of successful billionaires and how they made their fortune, such as Warren Buffett and Howard Schultz. Being thrifty with your money is the surest way to accumulate more and more.
Step 2. Start saving
It takes money to make money. Take a share of your salary as soon as you get paid and put it into a savings account, which you will use in future investments or simply to accrue interest.
Determine what percentage of your earnings you can afford to save and start there; even just 20 euros each month will become a small nest egg over three or four years. If you decide to put that money into a high-risk investment, you only risk what you can afford to lose
Step 3. Start a private retirement fund
Present in almost every financial company, these funds are customizable financial plans that you can create to start saving for the future. If you want to save a sum of money that ends in nine zeros, you need to start this as soon as possible. You can accumulate interest on your savings and decide to take a certain amount of investment risk to multiply your money.
The amounts to be invested can be minimum figures, or significant sums, depending on the specific policies of the various financial institutions. Do some research in your area and talk to your financial advisor
Step 4. Pay off your credit card debts
It is difficult to save if you have any kind of debt that is weighing on your head. Student loans and revolving credit card debts must be paid off as soon as possible. Average annual interest rates can range from 20% to 30% as well, which means that the dues to be paid can grow exponentially if you don't settle the amounts as soon as possible.
Step 5. Set up a five year plan
Calculate an underestimate of how much money you could be able to save in 5 years. Depending on the amount, it evaluates what could be the best way to use the money, whether it is investments, starting a business or simply using it to continue to accrue interest.
Keep your schedule a priority. Make sure you always keep your ideas a priority by writing them down and monitoring them regularly. If you find it difficult to keep interest in your projects, write down some points of your plan and keep them in sight in some point that you always see, such as on the bathroom mirror or on the dashboard of the car
Part 2 of 3: Invest
Step 1. Buy a property
A common way to make more money is to invest in real estate. Property value typically appreciates over time, and could be a profitable investment. This could be a new construction, a rental house, or a renovation.
Be wary of investing in an artificially inflated market and be sure to be able to pay the monthly mortgage easily. If you are not well informed about the 2008 subprime mortgage crisis in the United States and across Europe, it may be wise to first read some expert books and inform yourself, to protect yourself from some possible risks
Step 2. Invest in business
Starting your own business or taking over one can be a safe and solid way to make money in the long run. Create or choose a company that offers a product or service that you would like to purchase yourself and invest your time and money to improve it. Be well informed about the industry you are interested in and learn to distinguish between good and bad business investments.
Investing in alternative energy and information technology is a good prospect for the future. These sectors are expected to grow more and more over the next few decades, which means that starting now from scratch could be a smart investment
Step 3. Invest in stock trading
The stock market can be a great place to add to your nest egg. Watch the markets very carefully before you start buying and pay close attention to those stocks that are doing well; collecting this information will help you make better choices in the future. When you start investing, you understand that almost all stocks increase their value over the long term. Overcome small write-downs if you can and take risks every now and then.
With dividend reinvestment plans and direct share purchase plans, you can avoid going to brokers (and having to pay their commissions) by purchasing directly from companies or their agents. This possibility is offered by more than 1,000 large companies, and you can invest up to 20-30 euros per month, even being able to buy fractions of shares
Step 4. Put your money into money market funds
These funds require a higher minimum investment ratio than regular savings accounts, but make provisions at double the interest rate. When funds, like this one, are high-yielding, they are a little riskier (the ability to tap into the money and the ability to affect the investment are limited), but it's a good way to grow money by essentially doing nothing..
Step 5. Invest in government bonds
Bonds are interest bonds issued by the Treasury, which ensure there is no risk of default. Since the government controls the printing presses and can print as much money as needed to cover the capital, these are relatively safe investments and a good way to diversify your money.
Talk to a broker you've built a trusting relationship with and set up a stock purchase plan over the next few years to diversify your portfolio and keep your savings in different investments
Part 3 of 3: Maintain the Wealth
Step 1. Consult a broker for good advice
Your money is worth as much as the advice you can get to keep it. If you start to amass a significant amount of money, know that you don't need to spend all your time huddled in front of a monitor to check the change in share value percentages. You have to and want to live your life normally. You must therefore surround yourself with good financial advisors and brokers who will work for you to make sure that your investments will always continue to grow.
Step 2. Diversify your portfolio and investments
Don't keep all your savings in one place. By spreading them across different sectors, be it stocks, real estate, mutual funds, bonds, and other broker-recommended investments, you ensure that you isolate money in different markets that behave differently. If you find yourself making a risky investment in a company that goes bankrupt and you lose all your investment, at least you still have a significant amount of money in other sectors.
Step 3. Make wise and common sense financial decisions
The internet is full of cheap and scam investment plans that mostly appeal to uninformed and gullible people who can make bad financial decisions. Do careful research and constantly commit to investing and making money over time. It is not possible to become a billionaire overnight.
If in doubt, be cautious with your investments. If you've diversified your money wisely, allowing interest to mature and markets to float, you've probably made the wisest decision in the long run. Know that less is more. Rather than making mistakes and investing your money badly, wait for better times
Step 4. Know when to exit an investment
At a certain point, you have to understand when it is time to get out of an operation, before the damage becomes worse, with the risk of losing all the capital. If you have surrounded yourself with good mediators, listen to their advice, but also know how to follow your instincts.
If you see an opportunity to make a big sale and make a profit, go with it. Profit is everything. Even if those stocks will increase in value next year, you still have capital that you can reinvest elsewhere. There is no one way to invest
Step 5. Enter the role
If you are becoming a billionaire, behave like one. Surround yourself with wealthy and educated people, gathering advice and technical knowledge from experts.
- Cultivate an interest in art, fine cuisine and travel. Consider purchasing a yacht or any of the other status symbols typical of the rich.
- There is a difference between "old rich" and "new rich". The latter is usually a derogatory term for people who have recently become rich quickly and live by flaunting money, spending a lot of money and following a lavish lifestyle. If you want to keep your wealth, learn from the old rich and join the "stratosphere" of billionaires.
Advice
- Learn to take calculated risks. The money accrues interest while it is deposited in the bank, but you earn a lot more if you invest it intelligently, even if you take some risks.
- Be creative. If you want to start a business or invest in an existing one, try to find a new sector that no one else has considered so far.
- Proper time and day-to-day management can add adequate support to your investment commitment. Saving time and using it for other activities is a bit like increasing your income.
