How to Become Wealthy in 5 Years (25 Easy Ways & Tips)

If you want to know how to become wealthy in 5 years, this article will really help.

It contains 25 very awesome yet easy ways and tips that will help you become wealthy in as little as 5 years.

 

Can You Really Become Wealthy in 5 Years?

Of course you can.

But first things first…

To be wealthy can mean different things to different people.

You can be wealthy if you are in good health, have a wonderful family, have a dream job, etc.

All of these can be a source of wealth for an individual.

Most likely wealth or an accumulation of wealth translates into money or assets accumulated.

To become wealthy, unfortunately, is not like finding a genie in a bottle and having one of your three wishes fulfilled and becoming wealthy.

Also, it is not like winning the lottery and you are a millionaire based on a game of chance or if a rich relative mentions you in their will and leaves you ace a sizable inheritance.

As with all things of value, the worth of an item is greatly appreciated and made more valuable when an individual works hard to enjoy the things of life.

Becoming wealthy is not an instantaneous or overnight occurrence.

To be wealthy there are several steps, strategies, and sacrifice that needs to be made.

The good news is that the destination of being wealthy can be attained.

It’s just a matter of following a treasure map laid out by those who have traveled before us.

Let us go on a treasure hunt.

 

25 Easy Ways/Tips to Help You Become Wealthy in 5 Years

 

1. Know the Definition of Wealthy

The first question to ask to provide clarity towards becoming wealthy in five years is to define what wealth is to you?

For some, the definition of the wealthy might be just to have a little bit of savings set aside and meet their expenses each month.

Whereas, on the other hand, the definition of wealthy to another individual might be in terms of a set dollar amount.

While for others, the definition of wealthy may be to the point financially where they have no debt, have investments, and money set aside so that their golden years look golden.

 

2. Budget 

The next important step in achieving wealth is to have a roadmap or a budget.

A budget simply outlines all of the income coming into the household on one side of a ledger and the other side reflecting all of the fixed expenses and non-fixed expenses.

Fixed expenses are those items that need to be paid monthly.

They would include the rent or mortgage, insurance, utilities, and possibly more.

While the non-fixed items could include expense line items such as phone service, entertainment, clothing, food, etc.

Above all, the most important line item on the expense side of the budget is the payment to yourself.

That should be the first payment made and is designated towards your savings.

 

3. Have a Strategy

Once you know your definition of wealth and you have a budget now you can strategize on how you want to achieve your wealth.

This would include a number of the following tips and it is your plan of action.

This strategy should be visited frequently and adjusted as mile markers or landmarks are realized when traveling from point A to point B so it is with revisiting your strategy to make sure that you are on track.

 

4. Eliminate Expense

The big step that an individual can take as it relates to building wealth is to reduce debt.

This can be accomplished in two ways.

The first way is to work on any indebtedness that you may have and work to pay down that debt so that the interest payments that you are paying to financial institutions and credit cards are reduced and eliminated.

The other action step to take in regards to eliminating expenses is not to take on any new expense.

It is important to reduce credit card expenditures and the purchasing of items that require you to buy those items when it is not in the budget nor is it in your banking account.

 

5. Maximize Income 

When visiting the income side of the budget it is important to maximize your income.

If your income matches your expenses and you wish to set aside more money in building your wealth, it is best to not only decrease your expenses but increase your income.

To maximize your income would mean possibly taking on additional jobs to earn additional income.

This money then can be set aside towards your nest egg and eventually into your investments or a combination of both.

 

6. 401(k) 

If you work for an employer that offers a 401(k), it is important to maximize, at all costs, that 401(k).

For example, if as an employee benefit your employee offers your employer offers a 401(k) plan with the matching of 4%, then you need, as much as possible, to place 4% of your salary into that 401(k) vehicle that your employer offers.

To do anything less would be leaving money on the table.

 

7. Contribute to the Future 

The other strategy measure to become wealthy is to contribute to your future.

This means that if your strategy is to be wealthy in five years, then the math needs to be accomplished as to how much money will need to be contributed on a monthly and yearly basis to achieve that goal.

For example, if your goal is to contribute to your investment portfolio an amount of $5000 every year then you will need to do the math of dividing 5000 x 12 to come up with your monthly contribution figure.

In this case that would be $416.66 a month.

This amount can be achieved by cutting back on your expenses and earning more money.

The bigger picture or the wonderful and exciting goal would be the achievement of $25,000 in five years which would benefit from compound interest will be even more substantial than that principal amount.

Remember, it is important to keep the ultimate destination in mind and realize that to get there is a step-by-step process.

 

8. Nest Egg

An important fund that should be set up is a nest egg.

Many experts suggest that a nest egg should range anywhere from three months to six months to a year equally that number times your monthly expenses.

Achieving this amount will help the individual and family to financially survive in the event of something catastrophic happening (such as an illness or loss of a job).

By having a nest egg, you can utilize this money not only for your expenses or if not needed can be utilized to cover any major expenses as it relates to household items, vehicle expenses, etc.

 

9. Minimize Indebtedness 

If you are in debt or have outstanding loans, it is important to remember that these debts may be requiring you to pay significant interest payments.

It is counterproductive to be paying 12% or more on debt and only getting 10% on your investments.

It is important to come up with a plan of action to reduce your indebtedness.

This can be done by concentrating all of your extra money upon the lowest debt balance and paying that off and when paid off the next debt is tackled utilizing that payment plus all of your other available additional income.

Also involved with this particular plan is the psychological effect that it will create when having paid off any outstanding credit card or loan.

The other plan that you could utilize is to tackle your highest interest-bearing debt and concentrate all of your financial resources on that debt to reduce the balance and realize savings by paying off a higher interest credit card or loan.

 

10. Buy a House 

A good strategy in achieving wealth in five years is to purchase a home.

Rather than paying a landlord a monthly rent and then at the end of the day having nothing to show for it is a counterproductive use of one’s money as well.

Buying a home, an individual will be able to build up equity and increase their net worth by adding to their assets.

 

 

11. Minimize Taxes 

As it relates to your earnings it is paramount to remember that your earnings are important but equally important is what you keep.

As part of this financial commitment, as it relates to taxes, take full advantage of any credits, deductions that are offered by the tax codes.

If in doubt it may be a good investment to utilize the services of a tax professional.

 

12. Buy a Second Home 

If the opportunity affords itself a good investment is a second home.

You can use this as an investment property and earn rental income as well as the potential tax reduction options afforded to landlords.

 

13. Automated Savings 

Just about everything today is programmable and as a result, becomes automated.

Some vehicles are self-driving, automated light systems, automated appliances, etc.

Why not automated savings?

Set up an automated withdrawal from your checking or savings account or other financial account and like clockwork have a set amount of money taken from that account and put it into an investment vehicle.

With your employer, this might be able to be set up directly from your wage and earnings.

 

14. Diversity 

An important investment strategy is to ensure that you do not place all of your investments into one financial egg basket.

Diversity of investment accounts could include placing your investment dollars into stocks and bonds, mutual funds, ETF’s, cryptocurrencies, even gold, and silver.

The important thing is to spread out your portfolio across many investment options to ensure maximum return as well as minimize losses.

 

15. Read 

As part of your strategy on becoming wealthy, it is also important to take advantage of other individuals who have been successful in some of the methods and strategies that they have utilized.

Not only will this expand your thinking but offer opportunities that perhaps you didn’t think about and be able to take advantage of their wisdom and success.

 

16. Start a Business 

Another great way to become wealthy is to start your own business.

If you have a skill or marketable talent that will resonate with a customer base in your community and beyond, then starting a business might be a good opportunity.

In addition to possibly realizing a dream, there are several financial advantages to starting your own business.

Some of those advantages could include potential tax breaks as well as maximizing any potential investments toward your retirement.

 

17. Network With the Wealthy 

A practical action step that you can take is to associate with individuals that you admire and have succeeded in or are on their way to succeeding in potentially something that is in keeping with your dreams and vision.

If you wish to become wealthy, a good action step is to associate with those that are wealthy.

As the saying goes, “Birds of a feather flock together” is a reality and their attitude towards wealth and the achievement of wealth can be an attitude that may be assimilated by you.

 

18. Have a Mentor 

Another great strategy is to have a teacher or a mentor.

This individual, who is generally more experienced and knowledgeable would be willing to impart some of their wisdom and insight to help you along with your journey.

Also See: How to Make 80 Dollars Fast & How to Make Money With Unreal Engine.

 

19. Have the Right Attitude 

Actions follow attitude.

This means that if you have a positive attitude your actions will be in sync with your mindset and positive actions will be the outcome.

It is that half glass concept as to where your perspective lies and if your attitude is solid and good then actions will follow that attitude.

 

20. Educate Yourself

An important investment towards accumulating wealth would be educating yourself.

By investing in yourself and your education, it proven in most cases that the more education you have the greater will be your chances of qualifying for a higher salary and position.

 

21. Live Below Your Means 

Living below your means can be defined as not spending what you don’t have or below what you do have.

If you have an income of $4000 a month and you’re spending is at $4000 a month there is not going to be much movement towards that wealth goal.

If you can reduce your spending by 20% that would be an extra $800 a month which can go towards your investments or a cool $9600 a year.

Also, remember that when those bonuses and pay raises come treat them as not being received but continue to live on your pre-raise salary and put those bonuses aside in investment accounts.

 

22. Delay Spending 

An action step an individual can take to decrease their spending is by delaying your spending.

If you wish to buy an item rather than purchasing the item wait a period, perhaps even up to a month, to see if that item is still needed.

Then at the end of the designated time, you still wish to buy that item then by all means do so.

This is just a discipline that will deter an individual from spending at the moment rather than thinking the purchase through.

 

23. Take Care of Your Health 

It has been wisely saying there are certain occupations or institutions that you should try to stay away from.

One of those institutions is a hospital.

Other than routine physical examinations, being admitted into a hospital is something that is not high on our priority list of things to do.

Therefore, as much as in your power, you should endeavor to exercise properly, eat healthily, and manage stress levels.

All of these action steps as it relates to your mental and well-being will help to minimize any expensive hospital costs and help you towards your goal of achieving wealth in five years.

 

24. Stay Engaged 

Another reality is that fire tends to go out.

Upon starting your journey of attaining wealth over five years you most likely were engaged and excited about the prospects.

Unfortunately, the time has a way of tarnishing or diminishing our dreams.

It is important, therefore, to stay engaged.

Visit regularly your budget and your strategy and keep your dream of being financially wealthy in five years ever before you.

The best way to continue to develop any relationship, financial or otherwise, is to stay engaged and keep the relationship passionate and healthy.

 

25. Track Your Expenses

During the month, sometimes we will spend money here and there and then scratch our head at the end of the month and wonder where that extra $50 or $100 went to.

To stay focused on your spending and to limit these “mystery” expenditures, it would be a good idea to keep a financial journal.

This means that for every expenditure that you make in either cash, check, credit, or debit card, you record the date, where the money went, and what was the amount of that money?

You might be surprised at the end of the month to realize that a gourmet coffee here, a pastry there, and a beverage or snack there quickly adds up over 30 days.

Once this monthly financial log has been in place, take a look at it and be enlightened as to where that extra money may be better utilized rather than in a purchase of convenience.

 

Personal Story

My journey on the treasure map towards wealth began with the digging of a hole that contained no treasure but a hole of indebtedness.

Through a variety of poor choices and not handling the value of personal credit found me mired in debt to the tune of roughly $75,000.

Realizing that something drastic needed to occur, I was fortunate to have come into the possession of a book.

The book not only gave out practical steps of being released from the debt but having an attitude change as it came as it related to credit.

I also took advantage of a debt counseling service that helped me to manage my payments to my debtors.

The combination of the two can be likened to an individual trying to diet.

The two factors to successfully lose weight is to eat moderately and burn more calories than you need.

So I found it to be true in my case was to eat less (spend less) and increase my exercise (paying off credit cards).

Fortunately, there was a reversing of my financial misfortunes to the point where I crossed a line into positive net worth.

I was blessed due to the actions of a financial savvy author and the practical assistance of a debt reduction company.

 

Becoming Wealthy in 5 Years FAQs

 

Are there certain characteristics that the wealthy exhibit?

A study by an individual revealed that there are certain characteristics that millionaires exhibit.

These characteristics are known as “wealth factors.”

They include:

• Frugality
• Confidence
• Responsibility
• Planning
• Focus
• Social Indifference

This article can be read by clicking here.

 

When It’s All Done and Said What is the Most Important Factor to Becoming Wealthy?

There are a variety of opinions on what the best way to become wealthy is.

It would appear, however, that most people seem to think that starting a business, making it successful, and then selling it is the best way to gain considerable wealth.

 

You Can Do It

You are embarking on an exciting journey.

Yes, it is a journey of accumulating wealth but is also a discovery adventure to learn more about yourself and realize your dreams.

 

Conclusion

Being wealthy is a reflection of being independent and self-sufficient in working towards a goal and achievement of a dream to release you from the negative possibilities of not having money.

It is also a journey of self-discovery to realize once again that you can do anything that you set your mind to do.