5 Fastest Ways to Get Rich, According to Experts

Getting rich is pretty high on most people's list of financial hopes and aspirations. After all, this not only gives you more security when making financial decisions, but also gives you more options, such as if you want to start a retirement plan or other investments. Any financial advisor will tell you that your long-term personal finances and growth depend on more than just the amount of money you keep in your savings account.

Read: What to do if you owe taxes to the IRS

How to get rich: 5 ways

But the problem with the idea of ​​getting “rich” is that it takes a lot of time and effort. Get-rich-quick schemes are mostly just a way to prey on people who are struggling financially and trying to make more money. Unless you were born into a wealthy family and inherited a large sum of money, you will probably need to become wealthy through a combination of hard work and financial diligence. Here are 5 ways experts advise you on how to get rich.

1. avoid or pay off debt
2. Minimize debt by spending intentionally
3. Invest in a diverse portfolio
4. work on your career
5. start a side job

1. Avoid or pay off debt

Debt, especially high-interest debt, isn't necessarily bad in all cases, but it's something to avoid in most cases. For example, student loans can be beneficial if the principal and interest rates are not too high and help you pursue a lucrative career.

“Some experts argue that student loans are bad debt, but I disagree,” said Robert Johnson, chairman and CEO of Economic Index Associates. “I classify small amounts of student loan debt as 'good debt.' In my opinion, student loans have a bad reputation.”

Again, it's how you use them that matters. Student loans can certainly be bad if the numbers aren't in your favor. “There is no question that the system has been abused, and some students have racked up large amounts of debt and earned degrees without the earning power to repay that debt,” Johnson said.

Johnson also stressed that credit card debt is always bad debt and should be prioritized over student loans. Ariel Acuña, founder of independent wealth management firm LTG Capital LLC, recommended putting at least 20% of your salary toward debt.

2. Spend intentionally and minimize costs

If you want to get rich, it's important to minimize costs and be more intentional with your spending. This is the second step because it will save you money and is one of the first things you should do. You need to stick to a budget to spend intentionally and minimize costs.

That way, you can track exactly where and how much you spend. Acuña recommends a spending method checklist. “When you receive your paycheck, create a prioritized checklist for how you'll spend it. This includes allocating money for things like debt reduction, savings, fun, and emergencies. Masu.”

The goal is to minimize costs as much as possible so you can use that money to build wealth. “You need to be greedy and find ways to limit your living expenses and save 25% of your income,” said Jeff Barrow, Sierra Ocean's president and chief advisor.

3. Invest in a diverse portfolio

There is a limit to how much money you can put into a 401(k) or IRA, but that limit is high enough that many people don't reach it. That way, you can always invest more in your taxable brokerage account. Therefore, if you want to get rich, you should invest as much as you can, and there is no upper limit to the amount.

Although there are various investment strategies, most experts recommend investing most of your money in the stock market to get rich. Some people recommend some real estate and speculative investments. Barrow recommends a portfolio of 65% stocks, 25% real estate, and 10% speculative assets.

We recommend investing that money first in a tax-advantaged account like a 401(k) or IRA. This will help you minimize your tax burden and increase your profits in the long run. If you've maxed out all your tax-advantaged accounts, you can move them to a brokerage account.

4. Work on your career

There is no substitute for a high income. As is often said, there are limits to how much you can cut when it comes to spending, but there is no limit to how much you can increase your income, at least in theory. “As you advance in your career, business, or day job, and as your salary increases and your total income increases, always try to save more than you spend,” Barrow says. “The rising cost of living can completely ruin any get-rich-quick plans.”

Of course, whether your income increases or not depends on your job. For example, someone working on an hourly wage may have minimal means of increasing their income. But moving up the corporate ladder can be a powerful way to get rich, as it allows you to save and invest more.

5. Start a side hustle

The idea of ​​a side hustle or extra job isn't new, but if you have the time and can put in a few extra hours a week, it can be a powerful way to increase your income. Gig economy jobs like Uber and TaskRabbit make it easy to find flexible work. You can also find a list of side hustle types online.

Finding a side hustle is easier said than done, but this will give you extra money to keep investing. “He should find two or three side hustles that can quickly increase his take-home pay. Save it as much as you can,” Barrow said.

final take to go

In reality, there is probably no secret to getting rich. In general, proven approaches are your best bet, and our experts confirm that. There are many small steps you can take right now to get rich, like putting money in a retirement account, investing in stocks and bonds, and paying off debt.

Bob Haegele contributed reporting to this article.