This title apparently seems to simplistically reduce an exercise that millions of financial consultants, fund managers, economic gurus try to do with enormous effort every day.However, if we leave the exercise of how to invest our money to become rich for a moment, but focus on which are the two elements that modify our balance of wealth, we immediately understand that the exercise is not complex.
You get richer by increasing your income and decreasing your expenses. That’s all.Someone will smile, others will close this article before going on, but if we think about it, just make sure that this difference between income and expenses is positive every year. Regardless of how the financial markets go, we will be richer year after year. And considering that bond rates in Europe are at zero (or subzero), even just 1% more savings will give you a better return than the current low-risk bond landscape. So go for the Evergreen Wealth Formula in this case now. But Is the Evergreen Wealth Formula 2.0 legit? Yes, of course.
- Increasing your income isn’t easy, but you can always try. Jobs and financial or real estate income can be two important sources.
- Reducing expenses is not easy, but if we are not already in a situation of poverty, just think of how many useless things we buy every week to simplify this complexity.
Revenue And Exit
- If our income is € 40,000 a year and our expenditure is € 30,000 a year, the final balance will show a profit of € 10,000.
- If every year we manage to bring home this budget in 10 years we will have saved 100,000 euros. We will not be able to call ourselves rich people, but not even poor people with a figure that will make us sleep much more peacefully.
- But of course it doesn’t end there. This money can be invested to make our capital grow more or less intensely.
If we invest in bonds we will have certain and probably very low returns; if we invest in shares we will have perhaps higher returns (but perhaps also lower) and extremely dancing.And here we come to the point. What would have happened in the last 100 years to those who had decided to invest their savings in the stock market (we will take the American one as an example).Let’s see some examples through a very interesting computer found on the net.
Conclusion
Insert income and expenses, annual growth rate of income and expenses, and this calculator tells us what would happen to our capital every 10 years. Since the stock markets do not move constantly ensuring a uniform return, we will have very profitable decades and very poor decades.
