Building Wealth $20 At A Time

Some time ago there was a story of a woman who had built up a $40 thousand savings, $20 at a time. What she did was, everytime she spent money she would first put a twenty dollar bill aside in another pocket in her wallet and when it was full she would deposit it in a separate savings account, in a separate bank. After a short while she had saved up $40 thousand dollars.

I'm not made of money

Neither am I. So, how can you make use of this method of saving money? Especially if you can't put aside twenty dollars everytime you spend some money. Let me lay out a plan that anyone can adopt at any income level. You will have to to be completely committed and dedicated to this or it will not work. Without full commitment you will never be able to put money aside to build your own wealth.

How do I amass my own wealth?

First, you have to have a budget (or spending plan). If you don't have one, create one, now. You can't know how much you are making or spending if you don't have a budget (or spending plan). It creates a clear, and very visual, layout of your finances which will help you to get out of debt, and more importantly, build wealth. It's your road map.

Second, make a commitment to saving money. Every time you spend money, put some money aside that you will not spend which you will keep in a savings account separate from all your other money. This savings account will be used to help you build wealth.

Third, use the savings account to invest your money in various ways to obtain even higher returns. For instance, you can take an amount each year out of the savings account investing it in bonds, stocks, a mutual fund, or some other way to help you obtain high returns on your investment.

An Example

Let's say everytime you break a twenty dollar bill when spending money, pull five dollar bill out and put it aside, in another pocket or compartment in your purse or wallet. The idea is to pull it out before you are tempted to spend it. Then, when this pocket is full, or better yet, daily, empty it setting the money aside for your next trip to the bank.

Ok, so you can't afford putting five dollars aside each time you break a larger bill. Fine, do it with a couple of dollar bills. Every time you break a five dollar bill, pull out a dollar or two and use that to fund your savings plan.

The amount is not as important as you doing it on a regular basis and you allow the money to build up, grow. You have to commit yourself to not touching this money except for it's intended purpose: a vacation, retirement, a new car, down payment on a home, or, all of them. The money you save and then invest can be applied in any way you would like, just make sure you have a real plan and you are not forgetting about long-term investing – retirement.

Building Wealth $20 At A Time

I'm not made of money

How do I amass my own wealth?

An Example

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