In the beginning of your financial journey, you might think that saving and investing your money is the quickest way to attain the goals you set out for yourself. However, this is not quite true simply because at the start of your journey there isn't much capital to invest, you don't have much funds available. So it's wiser to amass more capital first before plunging into the investment realm.
First Earn More
The average person will not start with enough resources. Most of us started from scratch and climb our way up the financial ladder. In this day and age, nobody is really able to live a comfortable life from their earned income or job. It puts the lights on and food on the table. It basically keeps you surviving.
However, it barely helps in exiting the rat race. You have to bring in more than just earned income if you want to have some money left at the end of the day to put into savings or investments. Think about it, when your salary is paid out, how much is left to take home after you've paid all your expenses? Unless you're the CEO of a multi billion dollar company, there isn't much really.
Having multiple streams of income (atleast 3) is a great way to solve the lack of capital to invest problem. Exploding your income has been made quite easy in this digital age. There are myriads of ways to go about it; side hustles, freelancing, starting a business etc. It might require more time from your part but with a great strategy and persistent effort, you can increase the amount of money left in your pocket.
Then Invest
Once you start having a surplus in cash, you can then put it aside for investing. Mind you, the more money you can invest, the bigger the potential ROI. So don't go and splurge that surplus in instant gratifications, save and invest it!
There are a number of ways to invest, each has it's own risk and rewards. A golden rule is to invest it what you understand. But you can also invest in assets you don't fully understand provided you have done enough research about them. Crypto is a good example.
With the rise of digital assets, investing is not that difficult. The problem is how to spot the ones with a good and steady ROI. If you don't have an appetite for risk then you can stick to traditional investments like real estate, art artifacts, precious metals etc.
In Conclusion
Focusing on capital gains at the beginning of your financial journey will greatly help in having more money to put into savings and investments. There are myriads of ways to explode your income and have more leftover money at the end of the day, you just have to be creative and put in the work.
Compound interest works better with bigger numbers so be comfortable with delayed gratification and don't spend the money frivolously, Invest it and watch it grow.
Do you have an appetite for risks or do you prefer traditional investments?
Note: Not investment advice, do your own research. For information purposes only!
Thanks for reading!
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