People who read this post might think this is the most obvious and simple thing anyone has ever written. However, if you actually give it some thought, you will realize while very simple, it’s so rarely done.
Many people want to increase their net worth but forget there are two ways to do it. First, increase your revenues. As an individual, you might think you don’t have much flexibility to do so if you work for an organization. For example, you might think if you have a set salary, your only hope for an increase in pay is an end of year cost of living increase. If you are a teacher, you are limited to your teaching salary on the one hand but on the other hand, there are always other opportunities out there. Tutoring after school or on weekends would be one way. Creating a textbook for your topic might be another way. If you are willing to put in the time and thought, there are always ways to generate more revenue.
The problem arises when people increase their revenue and then increase their expenditures to equal or exceed the increase in revenue. As an example, a person gets a promotion and raise and their first thought is “I can afford a bigger house” or “I can afford a better car”. The bigger house or better car isn’t needed from a practical standpoint but they think it’s what is expected of them and want to be perceived as being successful. In many cases, a raise or promotion results in even more expenses than the increase in revenue because of the “need” to keep up with the Joneses. Does the bigger house make them happier? In many cases no. They have to spend more time cleaning, more on utilities, more to furnish and decorate it and as as result, they have less money than they did before and aren’t enjoying themselves either.
The interesting thing is when people look back on their lives they frequently find when things were simpler, they were happier.
So how can you increase your net worth? Look for ways to increase your revenue (it’s doesn’t have to be a lot) and at the same time, look for ways to decrease your spending or, at the very least, find ways to maintain the same level of spending as when you had lower revenue.
You probably don’t need the bigger house or the nicer car. Find what truly makes you happy and in many cases you will find it does not involve a lot of money. Stop worrying about what others might expect you to spend, do what works for you and you will find you are happier, healthier and wealthier as well
Simple concept but actually give it a try…it works
Have a great day!