Want to Build Wealth: 5 Essential Money Tips for Future Millionaires

Hey everyone, welcome back to our channel, and a special welcome to our first-time viewers. Today's show is all about building wealth and five essential tips that will help you become a future millionaire. Now, whether you're just starting out or maybe you're already on your way to becoming a millionaire, these tips are going to help you build wealth, so stay tuned.

Welcome to another edition of We're Talking Money. I'm Phil Clark, wealth advisor and founder of OmniStar Financial Group, and today I'm sharing five essential tips to help you reach millionaire status. Now, before we dig in, please do me a favor and hit that thumbs up button and consider subscribing to our channel. We deliver new videos every week to help you make better financial decisions. Let's get started.

Tip number one: create a budget. Now, I know this is a bad word. Nobody ever wants to talk about a budget, but any successful person, or business for that matter, tracks income and expenses. Now, technically this is called a financial statement, or a P&L, or a profit and loss statement. It's different from a budget, but you should have both.

By creating a budget, you can analyze your spending habits and identify areas where you might be able to save some more money. However, a budget by itself is not going to optimize your mission of becoming a millionaire, and that's because a budget only looks at where you are spending and where you are relative to what you set as the limits for each of the categories on your budget. You can have a great budget and still overspend and, unfortunately, under-save.

Now, adding the cash flow statement changes everything, and that's because you have a clear picture of what's coming in and what is going out, a net, meaning are you positive or negative. Armed with this information, you can quickly identify if you are spending more or less than you bring in. Your budget now becomes what it was intended to be. You can allocate a certain amount of inflows to categories, things like eating out, saving for retirement, your house payment or rent.

Cash flow and budgets are similar, but they are not interchangeable, so I implore you to use both. If you need a sample, we're going to place one in the link just below, so please click on it. Feel free to use it; it's there for your convenience. Remember, every dollar counts when it comes to financial success.

Tip number two: save and invest. Now, you are probably saying, well, maybe I already invest, or I'm already doing that. Let me get a little more specific. Now that you have a profit and loss statement that's tied to your budget, allocate at least 15 percent of your income to savings. In fact, I'd love for you to do 20 percent. You might want to set goals for emergency reserves, maybe a brokerage account, and your retirement savings plan through your employer. If you are self-employed, you can enlist the help of Uncle Sam by setting up your own retirement savings plan for you and perhaps your employees.

Now, make this commitment of saving a specific amount each month and make wise investments. A diversified stock portfolio is a good place to start. Real estate can be another attractive investment; the potential for appreciation and rental income is hard to beat. Investments offer long-term growth potential, and when done correctly, they can help accelerate your journey to millionaire status.

Tip number three: manage high-interest debt. I cannot emphasize this one enough. High-interest debt, such as credit cards, can crush financial success. So create a strategy to pay off those debts systematically, starting with the highest interest rates. And you want to make sure that as you pay these off, get out of the habit of using them, or at least out of the habit of living on credit. If you're carrying balances on credit cards, you are living beyond your means.

But it doesn't mean that cards are all bad. Actually, points or miles, cash back and other rewards, they can actually be a great thing. However, if you are carrying balances, the interest, which today averages about 21 percent, that interest is costing you a lot more than the value of all of those rewards.

Tip number four: diversifying your income. Now, this one is huge, and most people miss it. Relying on a single income source, I speak of course of your earned income, it limits you to building wealth with only a single source. Now, this tip is closely linked to our tip on investing, but there are some differences. Developing different ways to generate income is a hallmark of wealthy people.

You might consider starting a side business, or maybe becoming a freelancer by using some of your natural talents or something that you've become really good at doing. Perhaps you can monetize that. Don't rule out buying a business. If you have a great career, buying a business that is self-sustaining can be another great way to build wealth.

And lastly, tip number five: continual learning. Rich people never stop learning. In fact, wealthy people spend their time differently. Here's a list resulting from the research of Dr. Sarah Stanley Fallaw, and she says that millionaires spend roughly five and a half hours a week reading, compared to the average of two hours. Millionaires spend nearly six hours a week in the gym or exercising, and that's compared to the average of just two and a half hours. The average American spends 14 hours a week on social media, compared with the average millionaire's usage of just 2.5 hours a week. Millionaires sleep eight fewer hours than the average American, and they work six hours more per week.

Keep educating yourself about personal finance and investment strategies. The more you know, the better decisions you can make to grow your wealth.

Here's my list of wealthy people habits to get you started. First, live within your means. Save twenty percent of your net income and live on the remaining 80 percent. Be sure to read every day; 88 percent of wealthy people reportedly read no less than 30 minutes every day. Turn off the TV. Try watching less than an hour of TV each day, and do the same when it comes to aimlessly surfing the internet. Volunteer a minimum of five hours per month. This, by the way, has rewards that far exceed material wealth.

Don't forget to set goals. Did you know that 70 percent of the wealthy set and achieve goals? And find a mentor. Finding such a teacher is one of the best and least painful ways to become rich. This can be someone in your family, a colleague, or even a wealth advisor. Mentors are those who have gone before you, and if you find a good one, hang on tight. What they can give you is invaluable.

Now, I hope this video has inspired you to continue gaining knowledge, learning every day and practicing what the wealthy do. Now go out there, make your millions. Remember, building wealth takes time and discipline. Stay focused, remain patient, and before you know it, you'll be on your way to becoming a millionaire. Be sure to subscribe to our channel for more valuable content on personal finance and wealth building. I'll see you next time on We Are Talking Money.

Thanks for joining us on We're Talking Money. Be sure to visit us at omnistarfinancial.com, where you can learn more about how we provide value to our clients. So subscribe to the show and our newsletters, and drop us a line with topic suggestions for upcoming shows. If you enjoyed the show, we would appreciate you passing it on to a friend and providing a rating on iTunes.

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