4 Steps to grow your wealth (the sooner the better)

The best piece of advice I can give you to help you build wealth is this: If you are young, with the world at your fingertips, steer clear of bad debt, like credit cards and car loans. Bad debt is a silent enemy that creeps up on you, and stops you from having the successful financial life that you dream of.

When you are free from the shackles of debt, money becomes a powerful tool. It opens up a world of opportunities, allowing you to invest in experiences and assets that enrich your life, rather than spending a huge chunk of your monthly income on the insatiable fire of debt repayments.

With no debt, the next step in this game of life is to get your hands on some money. Yes, it’s often said that it takes money to make money, and while this isn’t always the case, for the average person, it’s a reality we must face. Start wherever you can, be it a part-time job or a side gig. The amount you earn isn’t as important as the discipline of setting aside a portion of it for your future.

Now what?

You might be wondering, “What do I do with this money I’ve saved?” The answer is simple: invest it. Use it as a seed to grow your wealth. Remember, even the mightiest oak starts from a small acorn. Whether it’s $200, $300, or $1,000 a month, every dollar you save is a step towards financial freedom.

One strategy to consider is purchasing a cash value life insurance policy. It’s like buying a small money-making machine. Each month, as you contribute to it, your money grows, guaranteed by the insurance company. And the best part? You can take a loan against this growing fund to buy other assets.

Here’s how that works

Imagine this: the $200 a month you’ve been diligently saving is now growing at a guaranteed rate. You then borrow against this growing fund at a low-interest rate, and use it to buy other assets that also produce income. The interest rare is low because the loan is secured by the money you put in each month. It’s a cycle of wealth creation that feeds on itself.

When you take the loan, the pile of money in the policy stays where it is, growing. When you take the loan, the amount of interest you pay shrinks as you pay if off, all while the money in your policy continues to compound and grow. You also get to decide how fast or slow you pay it off. If you have a tough month, you can skip a payment or two. You are in control.

You wealth is growing

So now you have the policy money growing, as well as your newly purchased asset (think rental property, building, business, etc) that is also producing income for you. When you pay off the loan, you are left with this new asset, AND still have that policy money that grew uninterrupted. Pretty sweet huh? The best part if that you can do this over and over again.

It is important that you find an insurance agent that gets what you are trying to do. There are details that allow this to work in a tax advantaged way, but only if you do it right. Find a certified insurance agent that understands how to use the cash value in your cash value life insurance policy to grow your wealth. Don’t try to do it yourself or just assume that any agent can do it. Find someone who understands it and can do it right.

Let’s Review

So, if I could turn back the hands of time and be 20 again, here’s what I’d do:

1. Stay away from bad debt. It’s the first step towards gaining control of your financial life.
2. Get my hands on some money. It’s the fuel that powers the engine of wealth creation.
3. Get a special life insurance policy (ask about a cash value life insurance policy).
4. Start buying assets. They are the machines that generate income and increase your wealth.

Remember, the earlier you start, the more time your money has to grow and compound. It’s not just about making money, it’s about making your money work for you. And that, my friend, is the secret to building a great fortune.