5 Tips to INSTANTLY Increase Your NET WORTH
There are two very important things to get started with: check your credit report & calculate your current net worth. I personally use Personal Capital to track my finances. Once you have a starting point, you can quickly get started on increasing your net worth.
1. 401k Matching
This is the quickest way to double your money. If you are able to get a 10% return in the stock market (which is very good btw), it would take you 7 years to double your investment.
When it comes to 401k matching, it’s literally INSTANT. You’re company matches whatever you put in. So if you put $100 into your account, your company puts $100 as well.
Every company has a different amount that they will match, so you can’t just put your entire paycheck. Reach out to your HR department to find out what percentage of your paycheck they will match.
2. Pay What You Can, When You Can
When your credit card bill comes at the end of the month, it’ll charge your interest onto the card. This can make it seem like the interest is based on the balance when the interest is calculated.
Interest is charged based on your average daily balance. What does this mean? This means that you should pay as early as possible. If you pay your bill 2 weeks early, that’s 14 days of interest you won’t be charged on that amount!
You won’t make you rich overnight but this will reduce your expenses & increase your net worth.
3. Open an Investment Account
Gone are the days where you have to pay a $20 commission to buy or sell a stock. You also don’t need $2000 to buy a share of Amazon. There are a ton of commission free brokerages, some even offering fractional shares. This means you can buy a $1 share of Coca-Cola & start earning a dividend.
You also get free stocks for signing up to the brokerages! The top ones are below.
Robinhood – They pretty much modernized current mobile investing. By signing up with my referral link, you’ll receive a free stock worth up to $500. Once you’re signed up, you can invite your friends & family to get another free stock for each referral.
M1 Finance – M1 does it a little bit differently. By automatically trading for you only once a day, it helps remove emotional buying or selling of stocks. Signing up & funding an account (can be $1) with a referral link will give you $10 to invest with!
Webull – Webull is a little bit more advanced & has more capabilities. To get your signup bonus of a free stock worth up to $1400, you’ll need to deposit $100.
Once you have your accounts open, buy some blue chip dividend stocks (ex: Coca-Cola, Target, Johnson & Johnson, etc). This will have increased your net worth instantly as well as your income. An extra $1 a year might not sound like a lot, but set it DRIP & forget about it. Deposit another $1 on top of that every week & before you realize, 10 years will have passed & you will be getting a nice chunk of change that will be paying for your phone bill. (Full Disclosure: I do not currently own stocks of any of the mentioned companies, though do plan on investing in them in the future)
4. Educate Yourself
Have you ever heard that Amazon pays less in taxes than the average American? This doesn’t mean that they are doing something bad, it highlights a lack of knowledge by the average American. Taking the time to learn a small amount about tax deductions, inflation, investing, etc will allow you to take advantage of situations that present themselves during your day-to-day life & increase your net worth.
5. Sell Your Junk
That paperweight in the corner needs to go. It’s doing nothing for you & definitely doesn’t do anything for your net worth. Sell it & increase your worth now. After it’s sold, place the funds into one of the investment accounts you opened & put that money to work for you.
It takes time…
It can feel frustrating at times when beginning to develop a net worth. A dollar here and there doesn’t feel like much. But at the end of the day, we all throw away dollars like it has no worth. If you are able to bring all those wasted dollars together, over time, it will make a difference in your life. We go crazy over a 20% discount on a can of corn saving us 20 cents but can’t manage to value the cash we aren’t spending.
Be patient & do what you know is correct. It’s far from easy, but it definitely is simple.