Perhaps you started this year vowing to grow personally, expand professionally, or simply grow up.  Do you also want to grow your wealth?

While no two financial pictures are exactly the same, healthy portfolios do have similarities. Follow these 13 rules to grow your wealth effectively.

Think of money as a tool.

That’s all those papers and coins are — a tool to get you what you want. They aren’t the only way, but it is a universally accepted exchange. Thinking of money as a tool empowers you to avoid many of the negative, intense emotions that can be associated with it, and to make rational, calm spending and saving decisions free of emotion. Money is a tool. That’s it.

Accept that it takes time to expand your tool kit.

It takes time to grow wealth. Period. “Time” in this case means years, sometimes decades. This can be a frustrating concept for young folks who are rarin’ to earn that cash, accustomed to getting what they want with the click of a button and bombarded by stories of internet sensations who made it big overnight and photographs of 20-somethings with luxury cars and diamonds in their ears.

Define “wealth”…

Do you desire a fat bank account, for uses to be determined in the future? The ability to fund an expensive hobby, like horses or photography? The chance to take years off work and afford time to raise your young children? Your definition of “wealth” may, or may not, be a McMansion and six sports cars. Whatever your definition is, congratulations! You’ve established a goal that is yours. Your definition of “wealth” is the one that matters.

… then define “wealth” again.

Accept that you will end up spending vast amounts of money on unplanned expenses. Your car will break down. You will have kids before you’re financially ready. You or a loved one will incur a hefty medical bill. This is called life. Money, that tool we keep in our pockets, will help us meet life challenges. So take a deep breath, relax, and accept the fact that your financial goals will change time and time again. Staying calm during times of unexpected spending will help you keep your eye on the long-term prize; freaking out or giving up on your savings plan in the face of adversity will not.

Acknowledge that cash is king.

If you can’t pay cash for it, you can’t afford it. Treat your credit cards like cash; this means sticking to a lifestyle that suits your income level so you don’t rack off more than you can afford, and paying them off regularly. Do your best to avoid assuming car loans — if you can’t pay the sticker price, search for a used car or take advantage of public transportation for as long as possible. If you have a take a home loan, keep it modest, and wait to look at homes until you can afford to put at least 20% down.

Save.

This is frequently repeated advice, and for good reason — the secret to growing wealth is to accumulate it. Read up on the latest from accountants and peruse personal stories online, check books out of the library, or hire a consultant through your bank to help with financial planning; however you do it, you must develop a savings plan. Once you have at least six months of living expenses for you and your family readily available, you can start to grow your wealth through different types of funds, according to the level of risk you want to assume.

Diversify your tool kit.

Talk to a certified professional about the benefits and drawbacks of savings accounts, stocks, certificates of deposit, IRAs, mutual funds, and any other number of savings and investment options. The key word here is “diversify.” You want to build a broad foundation, so that if something unfortunate happens to any one area of interest, your financial ship simply bobs along in a different direction, it doesn’t sink (and neither do you). Remember that purchasing land or a rental property, or upgrading a home you currently own are also ways to invest.

Shop around until you find a no-fee, cash back credit card.

Avoid complicated rewards point structures, or even airfare cards unless you are a frequent traveler; it can be difficult to gauge whether you will actually use these rewards and the value back on each dollar that you spend can be minimal. Annual fees add up and mean you often end up paying for your plane ticket or hotel room yourself with the fee. Once you find a card you like, stick with it for maximum benefit to your credit score.

Shop around, period.

It is tempting to purchase what we want, when we see it. Online shopping, however, means that nearly every product can be compared to a competitor, whether in your community or across the globe. Take the time to compare prices before you buy, especially on big ticket items. Once you have a good feel for the market, don’t be shy about negotiating for a lower price from a local merchant if you find an item cheaper elsewhere.

Expand your mind.

Get creative in seeking out ways to increase income — there are a lot of ways to earn money out there. Make a list of your skills, whether learned in a professional setting or elsewhere, then hop online to do some research, and talk to everyone you meet about how to possibly leverage those skills. Your local chamber of commerce, or meet up groups advertised online, can be good places to start. It’s a freelancing nation, and you may be surprised at what and how much you can pick up on the side of conventional employment.

Get your hands dirty.

Nothing is ever “too small” or “beneath you” in the money-growing game. Do not shirk from the hard jobs, the dirty jobs, or those that pay only a little in the beginning — pick them up, see where they go, and remember to save, save, save.

Find a good accountant.

Once you have money, you don’t want to give it away, do you? That’s exactly what you do come tax time — give your hard-earned cash back to the government. Tax codes are complicated, to say the least, so make sure you are giving exactly what you owe and not a penny more by enlisting the help of a seasoned professional. Though Certified Public Accountants are more expensive than do-it-yourself options, what they save you this year and in the years to come truly make this investment worth it.

Treat money management like a job.

Set aside time each week to review your financial accounts. If you’re starting out, this time may be as simple as going over your credit card statement to confirm that every charge is legitimate; if your financial picture is intricate and complicated, this could mean a weekly meeting with your financial planner or bank. Take time to study articles online, read a book from the library, or attend a local class that will teach you more about what all of those financial terms mean and how they apply to you.

Want to make progress today?  Find out The #1 Thing Stopping You From Becoming Rich Right Now 

Featured photo credit: Alan Cleaver via Flickr

Featured photo credit: Creative banking, financial success development growth and profit investment concept: macro view of stacks and rows of gold ingots or golden bullions barsvia Shutterstock

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