“Everyday is a bank account, and time is our currency. No one is rich, no one is poor, we've got 24 hours each.”
- Christopher Rice
Going from zero to a million seems like an impossibility in a society full of hopes and dreams. It's frequently believed that becoming a millionaire needs exceptional talent, good fortune, or birthright money. But I'm here to assure you that it is feasible! Anyone can reach the amazing milestone of going from 0 to a million dollars with perseverance, determination, and the appropriate mindset.
Although we all may come from different backgrounds and have different degrees of privilege, the road to a million dollars is not constrained by these circumstances. Anyone who is prepared to work hard and make the required preparations to protect their financial future is welcome to embark on this adventure.
Trust me, following these 8 powerful steps will take you where you want to be in the next 10 or 20 years i.e. having a networth of million dollars.
Develop Skills that Sales
To save and expand your wealth, you must first make money. You must learn crucial skills. In today's competitive environment, having marketable talents is critical. Understanding what the job market requires might help you build your skills. You can start a business, work for someone else, or freelance, but having marketable talents will be your basis.
Start Building Multiple Sources of Income
Diversifying your revenue streams is an important approach on your path to a million dollars. Relying entirely on one source of money might be dangerous, therefore it's critical to look into numerous ways to increase your income.
Whether it's investing in stocks or real estate, or launching a side hustle alongside your main employment, diversifying your income can assist you grow faster. Consider your income streams to be different buckets, and the more buckets you have, the faster you will be able to fill them.
Don't limit yourself to traditional sources of money either. Investigate the gig economy, online enterprises, and passive income investments such as dividends or royalties. By diversifying your income properly, you will be better able to weather financial storms and steadily develop your wealth over time.
You can start acting on step 2 after you complete the step above.
Setting up Starter Emergency Fund
When it comes to the road to a million dollars, one of the very first stops you should make is the creation of a basic emergency fund. Call it your financial safety net, your go-to lifeline when life throws you a curveball. And believe me, it will.
So, where should one start? Begin by saving a small but significant sum of $1000 in an easily accessible savings account. This financial cushion acts as a buffer against the unexpected. Whether it's a sudden auto repair, a medical cost, or your starter emergency fund assures you won't have to go into debt to deal with these financial curveballs.
It’s better to work on this step while you are trying to build your multiple sources of income.
Be Free of Debt
Debt might be a burden that slows your progress towards a million dollars. While some leveraging might be advantageous, it is critical to tread carefully. Excessive debt might lead to financial problems. Pay off high-interest bills first and cultivate a debt-free mindset. You'll have more resources to invest in income-generating possibilities and accelerate your wealth-building path if you get out of debt. Remember that financial independence begins with debt freedom.
Having a Full Coverage Emergency Fund
Think of it as comprehensive insurance for life's uncertainties. Once your starter emergency fund is in place, aim to expand it further. Consider saving an amount equal to 3 to 6 months' worth of living expenses. This extended emergency fund provides greater security, shielding you from more significant financial setbacks. With this buffer, unexpected challenges like job loss or medical emergencies won't send you spiralling into debt.
Investing for the Retirement age
Consider allocating a portion of your earnings to retirement investing once you've built up your emergency fund. Contributions to the Social Security Fund (SSF) and the Retirement Pension Fund are two examples. Compounding interest on early retirement savings helps your money to expand over time. This is about more than just financial independence; it is about ensuring a safe and prosperous future for yourself and your loved ones.
Preparing in Advance for the Major Future Events
Consider purchasing a home, buying a car, getting married, supporting your child's education, or launching a business. Each of these moments comes with its own financial demands. You can construct specialised savings or investing accounts by planning ahead of time and setting particular financial goals for these unforeseen circumstances. Contributions to these funds on a regular basis will guarantee that you are well-prepared when these opportunities or problems emerge.
Building Wealth through Investment
Owning a piece of equity is a must if you are willing to turn your zero dollar bank balance to a million dollar one. Consider exploring various investment avenues, such as the stock market, real estate, or even venture capital opportunities. You can dip your toes into the stock market through options like NEPSE (Nepal Stock Exchange) or dive into private equity investments. The key is to diversify your investment portfolio intelligently. We often hear names of billionaires like Bill Gates, Bezos, Elon Musk, Warren Buffet, Binod Chaudhary, and many others who have amassed their wealth by owning equity in companies. That is why it is very important to own a piece of equity in any business and trust me I mean it.
In conclusion, going from zero to a million is not only possible but achievable for anyone with the right mindset and actions. Believe in yourself and your abilities, set clear goals, create a plan, take action, work hard, manage your money wisely, and surround yourself with positivity. Remember, it's not just about the money; it's about the person you become on the journey towards becoming a millionaire. You have the power to transform your life and achieve financial freedom, and the sky's the limit!
Lastly, I would like to wish for your financial success with what I feel is the most profound quote on money ever made by Irish Satirist and Writer, Johnathan Swift :
“A wise person should have money in their head, but not in their heart.”