E8: 5 Wealth Building Strategies in 2023 for someone starting out.

The Real Wealth Podcast

In this episode I cover 5 key wealth strategies for someone who is just looking to start their wealth creation journey in 2023.
Key Takeaways:

- Welcome – not financial advice.
- Inherently means we are looking at low cost start up investment options.
- First thing to mention it is near impossible to start this phase of wealth creation if you haven’t mastered the first C in wealth – control
- Creating wealth without first mastering the major pitfall that most people fall in their finances;
o Increase your expenses in line with income
o Abuse of credit cards to buy things you don’t really need
o Ignoring debts and not effectively managing your money – credit card example
o Failing to effectively save
o Sacrifice short term for the benefit long term.
- Building wealth is a long term game and it comes from the foundations up. You cant build on shaky foundations
- Various news outlets report that 70% of people who win a lottery or get a big windfall end up broke in a few years, quoting a study by National Endowment for Financial Education (NEFE).

Strategy 1: Invest in yourself:

· Personal education, you are your best investment. Assets, jobs can all be taken away but no one can take away the knowledge you have built.
· Now in the digital age there is a wealth of knowledge available to the masses at relatively low cost.
o Podcasts – massive store of free knowledge on all subjects.
o Books – cheap access to subject matter experts, billionaire level knowledge
o Social media content – in amongst the videos of cats falling off stuff there can be hugely valuable
o You tube – when we started out in property I gain a huge amount of knowledge from that
o Chat GPT – can write you a curriculum
o Networking – free events. Fair warning usually an upsell.

· Learning earning and yearning. Merge then , constantly learning to grow the earning. Retirement is falasy.

Strategy 2: Stock and Shares:

· Good long term play to build wealth with relatively small cash pots
· You need to create money to invest, but you can do this from as little as £500 initial investment and £50 per month. Over time you can build up a decent fund.
· Invest via a self managed platform like Hargreaves Lansdown or Vanguard. Transaction fees are very low and you choose what index to invest in.
· We are talking here about an index as opposed to individual shares, as these are inheritantly riskier.
· Something like the S&P 500 - The Standard and Poor's 500, or simply the S&P 500, is a stock market index tracking the stock performance of 500 of the largest companies listed on stock exchanges in the United States. It is one of the most commonly followed
· Since its inception in 1957 average annual return is over 11%
· Example if you invest a starting pot of £1k and then £100 per month thereafter 10 year £25k after 20 years you would have £75k based on a 10% return.
· This type of investment is not designed to make you rich but it does start to create a decent investment pot
· Invest through your stock and shares ISA and you can invest up to £20k&