Are you an entrepreneur who is ready in to increase the income flow? Here are some suggestions for that strategy.
You are a freelancer or entrepreneur, and maybe you own your own business.
As an entrepreneur who has hired his or her staff, you can delegate much of the workload to that hired staff.
For some, the answer may be more time with family. For others, it may be traveling the world, more culture, or more time spent at resorts.
But, there are going to be those who desire to increase their income even more than what it is already. That could be a need-based desire or even a challenge to accomplish it.
If you fit into the category of desiring to make more money than what you already have, and you are in a position to start down that path, then it is time to develop your step-by-step strategy on how to do just that. Make more money. Since you seem to have already figured out how to do it in your business, and even how to delegate the workload to others, we are looking at a sort of passive income strategy. In this case, it is the strategy that includes that of investing the money that you have to make more money for you (and more money that you can continue to invest).
As an entrepreneur, you can accomplish the investment strategy whether you are already well to do, with your own self-sustaining business, or you are a freelancer with a modest quantity of clients. All you need to be able to do, to start, is to consider the idea. It is a moment to determine whether you are ready to increase that income in creative ways that include investments.
No matter how much money you earn, it is always a good idea to take care of your finances and look for ways to help that money pool to grow (especially in passive ways). What do we mean by passive? That means that the income is growing while you are doing other things, like “doing” your business, participating in our business activities, or having fun, including some of those “fun activities” in the list above, like traveling around the world!
Step One: Take Inventory
This first step in gaining wealth and growing your wealth through investments (and savings) is to be able to define what your current net worth is before we start the process. If you don’t know where you are, in the beginning, you will not be able to measure your improvement and gauge where you may need to tweak steps along the way.
Another aspect is to determine whether you are in a good financial spot or a not-quite-there financial spot to start your investing. If you are not quite at a spot where investing is a good idea, then we need to raise some funds to do so. In other words, you do not want to sell your first-born or take your refrigerator to the pawnshop to make a small investment. Instead, let’s get creative and get those funds ready for the timing of the investment.
By taking this inventory of where you are at, financially, and examining your net worth, you will be prepared to take the next steps immediately to change your life for the better and start your rise in improving your life and your success.
But, this step’s purpose/objective is to help you understand what money you can set aside for investing and where you may need to “tighten the belt” and save so that you have more money available for those investments. Again, this is not a time to go crazy (spending or saving), but to take inventory and plan out responsible, strategic steps, as a result of the financial inventory that you just took, examining your situation.
How would you like to have the surplus of money that it appears that the richest people in the world have? That might be reaching a tad high, but there is no reason you cannot put that as a goal for where you want to go with life. Aim high, take that inventory and take the correct strategic steps to achieve it.
Remember, many of the people who you may envy, who are considered wealthy, started from nothing and managed to build a large net worth from investments. So, it is not out of the realm of possibilities for an entrepreneur or freelancer. Even I was in the spot of defined as “wealthy,” so I speak from experience in saying it is doable!
Step Two: Believe in Yourself
Believing in yourself is something that is true even when you have not experienced success, as you define it, in your life, as you know it. So, maybe you have not managed to accumulate a significant wealth or significant savings, and you are not able to attend parties and describe yourself as independently wealthy, but that does not mean that that success is not just around the corner for you. Many entrepreneurs have reached success because they have started with a foundational belief in themselves.
Step Three: Educate Yourself
One of the key strategy steps includes taking a hold of the reins and learning some basics about safe investment strategies. Even if you intend to hire an expert in the field of investments, it is wise to ensure that you educate yourself, as well. That way, you can also spot a scammer if the supposed expert is not what he or she says.
The process of ensuring a comprehensive education process for you, in the area of investment strategies, may take time and especially, patience. It is easy to give up on something, especially when the challenges of life start to crowd the learning process out of your schedule. However, if making more money, and doing it correctly (i.e. without losing money), is important, then the education process should also be important, and there should be that time carved out in the busy schedule to accommodate the learning process.
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As a part of your learning process, you may be asked to define your objective. What is your objective? The objective (goal) may be that you need to get your savings substantially higher than what it is now. At the same time, as you feel that excitement in seeing your success in growing the savings, you need to manage the urge to splurge and spend those savings.
It is not uncommon to reward yourself by just spending a little and then realizing that that small amount of splurging turned into a larger amount than you expected and may find yourself having to start over with your investment strategy. If that happens, don’t give up, as we all have setbacks in life once in a while, and it is just another opportunity to prove that you can do this successfully!
So, what could we learn from an example setback like that (spending our savings after we see that we are successful at growing our savings)? That is where we need to tweak our strategy. For example, we may be able to avoid that setback by allowing ourselves permission to spend five percent of the savings increase and no more than just that five percent (or whatever amount you have set for yourself as a part of the strategy).
In that way, you are allowing yourself to splurge and reward yourself, but you are not blowing your entire savings in one spot. That is an example of mapping out your plan and including strategy tweaks that will help keep you on the right path.
It doesn’t have to be difficult or complicated. In fact, there is a great article on how to invest $1,000. For most determined freelancers, they can squander away $1,000 so that they have that money to try this investment idea. Starting with a relatively small amount of money, like the one thousand dollars can be just the right amount to implement the strategy and start to see the success of the strategy for you. Also, an amount like $1,000 can seem like a large amount, but it becomes attainable when you focus on raising the cash.
Step Four: Control Your Debt Load and Consumer Debt
One of the most important steps in building an investment portfolio is to control your debt. Even though it may appear difficult to manage the current debt level, it is possible and able to be handled, with some preparation and self-determination. It is a matter of setting the mind to accomplishing the goal and the objective of managing the debt level that is yours to handle.
After realizing that it is possible, managing debt level has to do with proper inventory, assessment, analyzing, and planning. At that point, it is about creating a workable strategy and sticking to that strategy until you have achieved the objective (i.e. becoming debt-free). Some common strategies include consolidation and awareness of which debts have the highest interest rates and late fees consequences.
By performing a basic visual analysis of the debt load, it allows you to see what is manageable and tangible. That allows a visual analysis of what needs to be done and where you are as far as income. It also allows the opportunity to see what needs to be paid out to lower the debt load.
Of course, if you have a debt that has a high-interest rate, say, at $500, and your $600 loan or debt has no interest rate, you will want to pay the $500 debt before the $600 debt to avoid the charges that can add up with the interest rate and possibly the late charges. In that case, the $500 may seem like the least, as far as amount, but it is more expensive than the $600 when you consider the possibilities of additional charges that can raise that debt level for that single item.
Ideally, you use some type of software, like QuickBooks or Quicken (both by Intuit) to manage and track the debt as you are paying it off and freeing yourself. You can also track it in Excel, for starters, and move on to accounting software at another time. Another option, if you have the funds, is to hire an accountant to help you get organized and develop that plan to control the debt.
Step Five: The Major Investments (And Insurance for Current Assets)
If you are now ready to make substantial changes in the pursuit of your investment strategy, you might explore options such as stocks, mutual funds, commodity market, bonds, and real estate. Also, make sure you have proper insurance for all of your assets. These assets include such things as your house, employment, health, current investments, etc.
Determine what insurance protection you have and what you will need among the above suggestions. Insurance will let you concentrate on planning for the future, so stay consistent with it. It wouldn’t hurt to find an insurance agent who knows his or her stuff, but is not a scam artist there to rob you blind.
Regardless of your financial situation, the sooner that you start investing, the better. Assuming that you have chosen the right investment path, or the right investment advisor to make the suggestions, the investment process, when successful, is one that involves being on the path of saving and growing your assets. The opposite of that would be spending your assets. That is also why you want to manage your debt level and hopefully bring that down as close to zero as possible, so that you are truly moving forward on that path of growing your assets, unaffected by other factors (like debt).
It is possible that your long-term goals may include education, vacation, or retirement, all of which are made easier when you have built up some investments to cover the high costs that these types of goals require, financially.
Some final advice includes the following two tips:
- Don’t forget to realize the possibility of loss (another good reason to seek out a reputable financial/investment advisor); and
- Remain open to expert advice and practical techniques to guide you on your path, keeping in mind that ultimately the decision (and results) are yours.
Regardless of how you choose to handle your finances, due diligence and hanging in there for the long haul are qualities that will help you succeed.