Establishing generational wealth certainly feels like the ultimate test of financial prowess, and frankly, depending on your lifestyle, learning how to build generational wealth can be pretty vital. Tech evolution, political instability, climate change; there’s a lot going on that probably makes the future feel kinda iffy! Having stability you can physically hand down can at least make our future financially safer.
Generational wealth isn’t built overnight…it’s, well, "generational", meaning it’s intended to last across multiple generations, and that sort of amount takes time, effort, and planning.
‘Gotta spend money to make money’ though, right? Most financial advice floating around on the internet on how to build generational wealth revolves around starting with big-ticket investments such as real estate, or generating new income from multiple sources. However, for most of us who rely on a standard 9-to-5 job (or similar situation) and probably have other financial responsibilities, investments with big start-up costs don’t make sense.
So, is the dream of generational wealth completely unachievable for a 9-to-5 worker?
Far from it! (And honestly, what kind of blog post would this be if we told you to give up?!) Generational wealth is definitely obtainable. All you need is some time, effort, and planning, and we’re here to help with the planning part! PowerToFly is committed to helping you reach your goals, and that includes how to build generational wealth with your current job.
How to build generational wealth
1. Ask, and you shall find
There’s a reason why this is number one on our list. We get it – asking for help can be super uncomfortable, but any help you need, not just in finance, is waiting on you to take that first step. Let’s take salary negotiations, for example. If you’re looking for a raise, you don’t have to wait for your annual appraisal. We’ve got a much more confident and zero-awkward way to ask: watch our easy guide onhow to negotiate more money and increase your income.
2. Invest in yourself with upskilling
We talk a lot about upskilling here at PTF, and that’s because skill economy is the future. Tech in particular is advancing jobs and industries at a breakneck pace, and those who don’t match pace run the risk of growing stagnant or worse, swept out of the workforce. To complement your income, check out picking up high-paying skills. For instance, a marketer could look at learning UI/UX or coding to tailor a more efficient range of services. The more useful a talent can be, the higher their chances of getting a better-paying job and the better their shot at job stability. Pro-tip: if you’re currently working, see if a training budget includes some of these certifications or upskilling opportunities!
3. Invest in the power of compounding
Thankfully, you don’t actually have to go all out and empty your bank to earn big returns. There’s a financial concept called “power of compounding", which simply means small amounts invested regularly over a long period of time can lead to big returns. A dramatic example (that, admittedly, relies on an incredible return on your investment) starts with saving just one penny and being able to double it every day. On day 30, assuming a 100% return, you’d have over five million dollars. Astonishing as it is, this is how compounding works! Small actions done repeatedly can lead to big changes. So, if you don’t have the cash flexibility to make big investments just yet, start small and stay consistent.
4. Upskill your finances, too!
It isn’t even about how much you invest but where you invest it. If you can, it can be a good idea to get a financial advisor or a finance coach to figure out the big stuff like the instruments that help grow our finances, how to save on taxes, how to budget better, and how to eliminate any debt. That being said, while hiring someone to run your finances for you can be helpful, it’s also good to take control of the steering wheel as soon as possible. Don’t just delegate your finances; learn it. This might be a slow and steady process and will require years of patience and practice, but it rewards like no other!
5. Retire any debts
Debts bring your credit score down, they impact your overall financial stability, and let’s face it: they are the constant stress you feel like you can’t escape. Some debt is (somewhat) inevitable or can actually help your financial health (mortgages, student loan debt, car payments all come to mind), but it is important that you retire your unnecessary debts as early as possible, particularly those with high-interest rates.
6. Get networking
We understand that sometimes, even after following the steps above, a job can feel like a dead end. You’ve tried everything, and yet the gig simply aligned with your goals. You may need to make a complete u-turn to boost your financial situation, and this is where your network of peers and industry leaders will come into play. Need a boost? Leverage professional platforms such as LinkedIn and PowerUp to grow alongside a strong professional community of like-minded and skilled talents.
7. Break the paycheck mentality
66.6% of Americans feel like they live from paycheck to paycheck, which means if they were to lose their job today, they wouldn’t have enough savings to keep them afloat for the next few months. Having the confidence of a fallback can reduce a lot of stress, and you might be surprised to learn that even high-income jobs aren’t always enough to guarantee stability and cash flow. Honestly, it isn’t necessarily about how much you earn but how much you grow what you make. Join the discussion and pick up some actionable tips onhow to ‘Grow Your Wealth with Every Paycheck'.
Generational wealth: how to build it
You have it now! The first step, or should we say the first seven steps, on the journey to building wealth that lasts generations.
At PowerToFly, we gather industry leaders to discuss new trends and trajectories for professional and financial growth. Check out some other articles like: 3 Keys to Building Financial Wealth as a Professional Woman in Tech
