Many of us have a little daydream of being rich one fine day.
We think of lots of wonderful things we could do with all that extra money. We like to think that many of them would be altruistic – helping out friends and family and perhaps also getting really involved in a charity of our choice. And ok, maybe there would be quite a few things that we would treat ourselves to as well.
Let’s face it, if we were really rich it would be the start of a whole new life.
But what does it mean to be rich? Especially in these strange times? How much money would you need to have before you could be categorised as rich?
And how do people become rich anyway? Is there any way you can work your way into richness?
Let’s take a look at what rich means and how to get there.
The definitive Rich List in the UK is produced by The Sunday Times each May. This year, it revealed that there are now 171 billionaires in the UK, a rise of 24 from 2020. The richest person on the list is Ukrainian businessman Sir Len Blavatnik who is worth a staggering £23 billion.
Not many of us can aspire to those great heights. But according to the personal finance comparison site GOBankingRates, you would need an annual income of around £62,000 to be in the top 10% of wealthiest people in the UK, and around £185,000 to be in the top 1%.
As well as salary, you also need to take into consideration whether you have non-work related income, and what other assets you own such as one or more homes. Then balance all that against your costs of living.
Perhaps a truer definition of wealth is if you have a regular level of income that greatly exceeds your living expenses, so that there is plenty of money left to play with.
Laying the numbers aside, what kind of things can you do to increase your wealth? Let’s take a look at five of them now.
What is your dream, your passion? If you are prepared to take a risk, you could pour everything into that with the longer term aim of making money out of it. Whether this is in the world of sports, art, music, writing, acting or any other kind of skill, consider becoming an expert in your field. To do this you will need to invest time, energy, and money. You will need to expect setbacks and rejections along the way. But you may eventually succeed.
Another creative way to make money is to spot a gap in the market then invent and patent something to fill it. Fans of Dragon’s Den will be very familiar with the ups and downs that this process can involve. You need to be absolutely sure that your product or service is not only meeting a genuine need, but it is something that people will love and want. If you can tick all the boxes you may be onto a winner.
Closely related to the above is to start up a business. This may be for your new invention, or may be a better variation of an existing business. See if you can find a unique approach in your chosen market sector, and work hard to build a business that stands out from the crowd. The journey will be tough, but the rewards can be great if you can pull it off.
If you would rather invest your money in other businesses, you can still reap great dividends if you do this wisely. You can start small and invest steadily, ensuring that you reinvest profits into your investment portfolio to earn more. Stocks and shares are more likely to bring you wealth over a long period of time, as their value can fluctuate up and down with market conditions. But if you can lock some money away for a while, you could see some very healthy returns.
Property is almost always a good investment: there’s a lot of truth in the saying “safe as houses”. So if you are in the position to be able to afford a second property, this is usually a sound investment. You could either use it for rental income, or redevelop it and sell it on at a profit which you can then use to purchase another property and so on. To get this right you need to choose your properties wisely, for either rental or resale appeal, and develop them well. You may also be affected from time to time by fluctuations in the property market. But if you are careful about what and when you buy and sell, you could make a lot of money from investing in property.
None of the above five ways to get rich is easy! Most will take time and effort, and unfortunately some of them may also require a bit of money to get going. But if you have serious ambition to become seriously rich, they are all ways that have worked well for others over the years.
But even if you don’t want to become mega rich, there are still many things that you can do on a daily basis to manage your money well and make the most of what you have got. Things that will help you to become comfortably off rather than heading for the Sunday Times Rich List. And – more importantly – will help you to enjoy life rather than worrying about money all the time.
On this page we will regularly feature articles that will help you to do just this. We also offer low apr loans for a variety of purposes that may be able to help you on your way. So remember to check in again soon with us here at Munzee Loans.
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