Wanting to Invest is a great thing to do. Preparing for the future is always fun, and takes discipline. So I am going to help you find out how much money you should be investing each year. So without further ado.
What is Your Income
The first thing that you should do is take a count of how much money you make. This will give you a good starting number of how much you could potentially invest. This comes along with budgeting as well, which I wrote an article about earlier.
Once you know how much money you have, you can determine how much you can invest. The biggest thing here is that you don’t let the dollar signs get you. Everything is relative. So don’t be upset if you aren’t able to invest a huge amount of money right now.
Debt
Debt is something that is never going away. Hence all the articles I write about debt. When looking at your debt make sure you are tackling the highest interest rate first. This will allow you to use the debt snowball method of eliminating debt.
You can either invest all your surplus money in hopes that it outpaces the debt that you have. Or you could throw all your surplus money into your debt and become debt free faster. Or what I like to do is play both sides. Find a balance that is best for you and stick to it.
Investing Goals
Anytime you start a journey for the first time, you have a “Why” associated with it. So you need to find your reason for investing. Is it early retirement, saving for college, going to make a big purchase in the future, want to vacation harder? Finding your why will help you stay on track when times get tough.
Once you have your reason, you need to figure out the timeline that you want to accomplish these goals. 1, 5, or 10 years is a good starting point to give you a deadline to meet whatever goal you have.
Rob’s Opinion
Investing is one of the most fun and positive things you can do with your money. And the biggest thing you have on your side is time. Time to accumulate wealth through investing. Many people know about it but not everybody participates in it. Don’t let this be you.
If you are looking to make a quick buck there are thousands of ways to do it. But the most important thing is that you build something sustainable that will pay you for the rest of your life. To be put years ahead of everyone else, head over to my Wealth Building Playlist to find out how.
