The truth is that many people who we would consider rich are just as broke as the rest of us. This may seem odd because they are earning hundreds of thousands of dollars a year while we are lucky to earn twenty or thirty but the truth is that good habits don’t simply appear because we earn more money and they don’t disappear because we earn less. Becoming truly rich in the sense of having a disposable income and not constantly struggling with bills is a process that can be started at any income level, though it can be easier with more money coming in.
First you must make a budget. It is important to understand what money you have coming in and what money you have going out. This can be difficult especially for those with fluctuating incomes but if you focus on keeping your expenses under control then there should not be a major problem. Consider redundancy in your spending. If you have high speed Internet you may be able to replace your current phone service with an Internet service or even replace your cable with the same shows which are now played on the Internet within days or even hours of their first broadcasts.
Second, learn to same. No matter what your income is you should be able to put 3 to 5 percent of your income into savings. This will help with your budget by allowing a buffer to build up in case of expenses, but most importantly is the understanding that time is as important as money in the concept of saving for college or retirement. Even a few dollars a month can add up to thousands if it is simply put into a compound interest bearing account and left alone.
Third, eliminate debt. For some of us this is easy for others it is a long term project but every debt you eliminate is money in your pocket, or better yet your savings account, every month. Removing credit cards from your life may seem in the short run to make things more difficult but in the long run you will have far more money, the same can be true of a car payment. Instead of borrowing money for that car, plan ahead. Once your current car is paid off begin to put the same amount as the payments into an account every month and by the time you need another car you should have considerable savings and as each debt disappears the others will become easier to get rid of. This cascading ability to remove debt is not only useful but exhilarating and soon you will find that you have enough money to spend on those extras that make you feel rich.
The most important thing you can do to make yourself rich on a meager income is to think about your future not your present. No amount of money is so small that given enough time it won’t become large thanks to compound interest and no amount of savings is to unimpressive if you calculate it out over the forty years of your working life.