How to get rich eventually? Why not follow some of the tried and true habits of the world’s richest people. I recently read a Bloomberg article that reported that the 400 wealthiest people on earth (all billionaires) were worth a combined $4.1 trillion – that’s up $92 billion in 2014 alone.
Among the notable highlights were that Bill Gates is still the world’s richest man with a fortune of $87.6 billion. Warren Buffett added $13.7 billion to his net worth which propelled him to the #2 position on the list. The one person with the biggest 1 year gain was Alibaba co-founder Jack Ma. His net worth rose by an astonishing $25.1 billion. How would you like that for a year-over-year increase to your net worth?
This got me thinking about how everyday working people can start to build and increase their wealth. After all, the whole idea of this blog centers on that very question.
For me, the most important answer to that question is to start saving and investing small amounts automatically and watch them grow over time. The rich get richer because they are always investing their money. Think of Warren Buffett, I read somewhere that in 2013 his wealth increased by $37 million a day! He obviously wasn’t parking his cash in a savings account, earning a measly 1%!
Nowadays there are lots of options for those interested in investing their money and the great thing is that you don’t need very much money at all to start.
As I mentioned in my article on TD e-Series funds, you can invest as little as $25 a month into one of their low-cost mutual funds. When you think about it, $25 is really not all that much. It’s probably less than half of the average person’s monthly cell phone bill.
Another option is that you can set up an account with Questrade and get commission-free exchange-traded fund (ETF) purchases. Most ETFs have a pre-authorized purchase plan (PPP) option where you can purchase shares in a given fund for as little as $25.
For those interested in owning the stocks of their favorite companies directly they can purchase them through a Transfer Agent in something called a dividend reinvestment / share purchase plan (DRIPs/SPPs). These plans offer commission-free stock purchases and most plans have a minimum purchase amount of between $25 and $100. Again, I’ve discussed this investment option in a previous post. In case you missed it, you can check it out here.
So these 3 options give average people a chance to buy mutual funds, stocks or ETFs without having to spend thousands of dollars all at once. By making regular contributions to an investment portfolio anyone can grow wealthy over time. The sooner you start, the better off you’ll be.
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