“Rich people commit to being rich. Poor people want to be rich.”

If you’ve never heard of Dave Ramsey, I highly suggest you go to Youtube and watch a few of his videos.  The 6 simple tips Dave mentions in this video can be applied by anyone, and are probably some of the most reasonable and simplest financial practices to build wealth.

Although this video is from 2015, the accuracy is undeniable.  If you want to achieve financial freedom, it starts with knowing how to efficiently utilize your income.

For starters, having a steady stream of income is nice, but having a secondary income is better.  Ultimately, you should find several ways to grow your wealth!  More importantly, passive income should eventually become one of your primary financial objectives.  The sooner you’re able to secure additional steady income outside you’re job, you’ll quickly be able to resolve any monetary burdens and eventually retire sooner rather than later.

In addition to generating extra income, being patient with the budget and waiting for the right time to make purchases will help keep you in the black.  If you need help with a budget, check out this article on creating a budget. Unless your investing into an asset, why are you going to spend money you don’t have?

Stop spending money you don't have, to buy things you don't need, to impress people you don't likeClick To Tweet

We stress the importance of maintaining and respecting a budget.  I promise you, only good will come from it.  Think long term satisfaction over instant gratification.  As they say, good things come to those who wait.  If you do the math out, you’ll realize how quickly you can save up to put a down payment on a house, pay for a car cash, or treat yourself to a luxurious vacation.  After all, it’s your hard earned money and you deserve to enjoy it, but being able to make those expenses and still tackle life’s unexpected surprises is great!

Speaking of investments, I wish someone had explained the concept of assets versus liabilities a lot sooner to me. Had I possessed the knowledge I know now, I would’ve never financed a car.  Cars are depreciating assets aka liabilities. Although there are exceptions, you don’t usually get a return on your investment when purchasing a vehicle.  One thing I want you to bare in mind is that a 10 year old car was manufactured in 2006.  Now consider the technology and reliability of those cars.  In all reality, as time progresses, there won’t be too many reasons to finance a car.  Be patient, and buy one cash.

This next point, is a touchy subject.  I can say for certain, that most of us who decided to pursue a college degree had some preference in where we wanted to study.  The only point I want to make here is to really consider your options.  If an opportunity presents itself, even though it’s not your preferred school, I suggest you take it!  As Dave Ramsey said, “it’s difficult to find any research that says that’s why people succeed.”  If that doesn’t sell you, then consider some of the greatest innovators of our generation who decided to drop out of school altogether.

Dave’s last point is to stay away from opening a credit card unless you absolutely need it.  I know for the majority of us, credit cards are a sure way to build our credit score, however, if misused, it can quickly open the door to a lot of debt.  Follow these tips to help build your credit score and responsibly manage your credit cards.

I hope you consider at least some of these tips.  They say money doesn’t buy happiness, but it certainly buys the things that make you happy and takes care of the problems that make you feel stressed.

Let’s review:

  • Find ways to generate side income
  • Be patient, and don’t buy things you can’t afford
  • Create and respect your budget
  • Avoid financing a car if possible
  • Exhaust all options before choosing a school
  • Manage your credit cards responsibly or don’t have one at all

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Elliot is a Northeastern graduate and the editor for ElevatedPost. His mission is to help motivate, inspire and teach. His passion is driven by his desire to help others self-improve and realize their untapped potential so they may find success and prosperity.