Wealth Building Systems - From Roulette To Forex What Is The Best Way To Build Wealth?

The goal of acquiring a passive income is a common one, and in order to do so, one must have a wealth building system that works.  Ascertaining the best wealth building system has a lot to do with you, your goals, your current capital, and your patience.  It is safe to say that a plan to buy lottery tickets or play the slots until you are rich is not a realistic plan; however, there are solid steps you can follow that will lead you to the life you would like to be living.

Listen to the radio or watch television for any length of time, and you will soon learn that everyone has a wealth building system.  Multi-level marketing, real estate, distributorships, day trading, are only a few.  Are they scams?  Not necessarily, but there are not easy answers; if it seems too good to be true, then it probably is.  There are individuals who have been very successful using these methods, but they took more time and more capital than the advertisers ever let on. 

The most successful wealth building system is one that is planned in advance.  Set your goals and a timeline, and work to reach them.  Know, realistically, where you would like to be next year, in five years, and in ten years.  Map out the steps you will take to get there.

The first step in building a wealth building system is setting a goal for how much money you wish to make in passive income.  For example, if your goal is to be earning $5000 per month from your portfolio, at a 6% interest rate, you will need about $1 million in capital.  Obviously, this is not income you will earn overnight.  However, here are the steps to take to get to your goals.

The initial investments required in this wealth building system include municipal bonds, CDs, TIPS, and I-Bond.  Municipal bonds will earn more money overall than will a taxable account.  This is because, although there are fess involved with municipal bond purchases, they interest earned in tax-free.   CDs can be opened at local bank branches or remotely; the key is to watch for the best interest rates.  TIPS and I-Bond have lower returns, but they protect your money against inflation and market fluctuations.  These are the ideal initial investments because they are relatively safe and require little capital. 

When you begin to see returns on your investments from the first tier of your system, invest them in intermediate term bonds, high yield funds, and RIETs.  These are more aggressive than those in the first tier and will maximize your returns on your initial investment.  Once this stage of your portfolio begins to show returns, you will invest these returns into your next tier of the wealth building system.

At tier three, you will be researching convertibles funds and convertible stock funds, as well as specialized real estate funds and floating rate funds.  These yield a higher percentage than the investments of the first two stages, and can be more risky if you are not careful about choosing where you invest.  Dividing your investments into all four products will diversify your portfolio, maximizing your passive income potential.

This wealth building system works for all levels of investors.  If you start with $50,000 at tier 1, and build it to $100,000. before investing your passively earned $50,000 at tier 2, you will ultimately have $100,000 to invest in the higher yielding accounts at tier 3.  Once you have doubled your investment at tier 3, take a portion of your earnings and start over.  You can repeat the process until you have met your goal. 

Do not despair if you do not have $50,000.  Obviously, a greater investment brings higher yields, but the wealth building system works at any level.  Taking the time at the onset of investing will help you turn your dollars into a lucrative passive income over time.  The ultimate requirement is patience.  If you work this wealth building system as prescribed, once you have repeated the process one or two times, you will see the gains grow more rapidly, and the process will snowball. 

While the term, passive income, implies that no work is involved, be aware that in the beginning, a great deal of research and planning is necessary; with the proper preparation, the income will be passive.  However, any investment is a risk if you choose to move forward without any time spent in the beginning, ensuring your decisions are sound.  Do not hesitate to consult with a professional if you are unsure of your investment decisions.  A poor decision will be disappointing, if not devastating, but a few sound decisions can lead to a successful wealth building system and a satisfying accumulation of passive income.