Is it still possible to build wealth in America? (credit card debt, 401k, debt)

[Ron.]

I am not talking about inventing anything new. But in a general sense. I want to start my home based business and eventually buy a few smaller businesses as well with the ultimate goal of creating a nice amount of wealth. Not hundreds of millions but enough to where i can enjoy my life.

Is it still possible to do?


It seems the only way you can build wealth now is to be a 20 y/o billionare. At 34 I must be a damn fossil. But any way dos america still have opportunities?

[simcity]

Originally Posted by ChicagoRon

It seems the only way you can build wealth now is to be a 20 y/o billionare. At 34 I must be a damn fossil. But any way dos america still have opportunities?

The only American billionaire who's in his 20's is Facebook founder Mark Zuckerberg. So, being in your 20's and a billionaire is literally as far from the norm as you can get, considering there is only one such American in this category.

FYI, a 20 (twenty) year old billionaire does not currently exist anywhere in the world. Also, if you are a 39 year old billionaire then you are considered YOUNG in Forbes opinion:
Young Billionaires - Forbes.com

Remember, the average American millionaire is in their late 50's. Now when we extend our lifespan to say 150 to 200 years, then yes, accumulating wealth would be far more viable for some.

Now with the way the dollar is falling, becoming a millionaire won't be such a big deal anymore.

[BLAZER PROPHET]

It's always possible. Always. It takes some smarts, guts & luck.

About 7 years back a friend of mine was unemployed. He had no idea what to do with himself. However, his mailbox was smashed so he decided to start an internet lockbox & mailbox company. He had no idea how to even start one. Seven years later he has a $700,000 house, 2 awesome cars and he's flat out amazed how it all happened.

[desertsun41]

One thing is for sure. It sure ain't as easy today as it was yesterday. Like the old Animals song went and Eric Burdon sang: Its a hard world to get a break in, all the good things have been taken.

You can dream up all kinds of ideas for a new business but the fact of the matter is thousands of others already have thought of it first, and tried, and most failed.

Another thing is for sure, you will never get rich working for some slob at the expense of your own time and pride. When I was just 17 I was working for schleps for $2.50/hr pumping gas. Then I got this job at Hertz cleaning cars that paid $8/hr....this was back in the early 70s, that was great money.

Then one day I saw this very unusual thing taking place. There was a man coming in to refinish tires with this crazy machine so they looked brand new. He was grinding and putting on white walls to the tires. He was also applying raised white letters like the ones on tires you buy advertising the brand, only he was doing personalized lettering like your name or some saying. I was fasinated and the fact that he charged $4/tire amazed me. The guy was making $300 a day back in 1975 or so. The one I remember the best was he did lettering on all 4 tires that said: "Gas grass or ass, no one rides free". He charged $30 for it and completed it in 30 minutes.

So I watched and questioned him for months. Finally one day he asked me if I wanted to buy his business for $5000 and that included 5 big car dealer accounts. I begged borrowed and stole to get the money. I was hooked. I could work 3-4 days and go fishing the other 3. I value and treasure my freedom more then anything.

I kept that business for 13 years while adding other things like pin stripping and windshield repair. I sold the business for 4 times what I paid for it with the 20 or so good will accounts. I never looked back. Today I still feel the same. I would rather hold out a hat on the street corner then work for some slob for minimum wage while he makes millions at the expense of my time and pride.

Dont get me wrong. That attitude dont make me wealthy. But that attitude allows me to be a human and not a robot.

Good luck to ya man. It's a big world out there and all the good things have indeed been taken but things will fall into place for you if you are patient and keep a keen eye.

[westindian]

Originally Posted by ChicagoRon

I am not talking about inventing anything new. But in a general sense. I want to start my home based business and eventually buy a few smaller businesses as well with the ultimate goal of creating a nice amount of wealth. Not hundreds of millions but enough to where i can enjoy my life.

Is it still possible to do?


It seems the only way you can build wealth now is to be a 20 y/o billionare. At 34 I must be a damn fossil. But any way dos america still have opportunities?

America has great opportunities and you will do well if you have determination and will power. You can create a new business or buy into an existing business and become a self made millionaire. It is always possible. I am 26 and I am in this catergory and doing quite well for myself. I have several business with my family and have never looked back with regrets. Good luck.

[forest beekeeper]

Originally Posted by ChicagoRon

...
Is it still possible to do?

Thousands of families do it.

[bale002]

To be sure, as the rest of the world has caught up, the average wage-earner in the US can no longer afford the classical middle class lifestyle (family, home, car, various gadgets, savings).

But what did you expect, really? Though the classical middle class dominates the living memory of most people in the US, historically it is a brief moment and there is no reason why anyone with a knowledge of human history should have expected it to last.

Nevertheless, the real American dream, if there is one, is to own one's own business (dumbed down in the 2000s to mean borrowing above the hilt to become a debtor to an overpriced, energy-guzzling, non-income producing house).

As long as marginal tax rates remain low, that dream is still a possibility. The challenge is to find a competitive niche in which to sell services or products, preferably on a global scale (but even local and national businesses can still work depending on their microeconomics), and to know how to manage costs.

I have an internet-based, home-based business selling services on an international scale. I won't be a billionaire, but at current tax laws and my current pace of net profit (which includes conservative spending habits and saving, and long-term financial investment of that saving), I could retire in 18-20 years with $2-3 million in assets, maybe more, probably enough to be comfortable with.

Find a niche, manage costs, save and invest (in yourself, in your business or businesses, and in long-term financial assets- including a portion in real estate -, in that order), and insist that marginal tax rates, and the entire level of taxation, remain low. Yes you can.

All the best!

[Niners fan]

Good posts. Yes, it is still possible.

I think there are often just a few things that separate people who successfully build wealth from those who don't. It is possible to build wealth as an employee but it take much more discipline. My perspective - since I am self-employed - is that it is easiest to build wealth if you have your own company.

1) Put yourself in a position to take advantage of opportunities. Live below your means. If you have $1000 per month in car payments and a $2500 house payment then you are not likely to be in a good position to act on an opportunity when it comes. It still usually takes money to make money.

2) If you have to work for someone else then find a small company to work for. Be willing and able to do a lot of different jobs. Observe the owner and how he has been successful. You can also learn a few things you would do differently. Make yourself as valuable to the company as possible, both in money generated and in knowledge and abilities.

3) Keep your eyes open for opportunities. These are often niches within your current line of work. When you see an opportunity jump on it. You might be able to work with the owner of your current company. Follow-up on leads consistently and constantly without becoming a nuisance. (And not just sales leads but leads for launching and financing your venture.)

4) Pick your business partner (if you have one) very carefully. A partner can provide some useful accountability for you. He can also be a pain if you don't have the same vision. There are few circumstances where I would consider more than one partner in a company. If you start splitting profits three, four, or more ways then there often just isn't enough to support everyone full-time.

5) Be willing to work hard and long hours. It doesn't mean you have to be at the office at all hours. For many people (like me) you can do a lot of work from home in the evenings. The nice thing about not punching a time clock is that your are never clocking in. But at the same time you can't clock out either.

6) Don't be afraid to expand your company. It is a hard jump going from flying solo to hiring some employees. But realistically you are not going to build your company very effectively past a certain point by yourself. There are times when you want to hire someone with experience. But in general I would hire employees based less on their qualifications then about their general competence and integrity. It is probably much easier to train people for your industry (and you get to teach them to do it your way) then to try and instill competence in them. You can also start them out at a lower wage and give them a commission or bonus for growth so they feel invested in the company's growth.

7) Don't be afraid to follow your instincts sometimes. Often times things are done a certain way because that is the best way to do them. But other times you want to innovate and stand out. As you become successful don't forget to listen to your instincts that got you to that point.

Good luck!

[cpg35223]

My wife and I have gone from nearly broke to almost a million in assets in 8 years. The key is actually having discipline. So here's my advice.

1) First, it's impossible to build wealth without a budget. Until you really look at what you're spending, then you'll always spend every dime you make.

2) Second, you have to work and work hard. My wife and I have worked extremely hard in the past eight years.

3) Live beneath your means. I mean 20-30% under your means. At this point, we live on my salary and bank my wife's. At first, it was tough to do, but as our salaries improved it got much easier.

4) Pay off debt first and foremost. If you have credit card debts, refinance your house to pay off your cards. THEN PUT THEM IN THE DRAWER EXCEPT FOR ONE CARD FOR EMERGENCIES. Honest to God. If you can't pay with case, check, or debit card, don't buy it. If you must charge something, then pay for it with next month's budget. Make it a frame of mind and, after awhile, you'll be amazed at how you don't even think about it.

5) Once you have a budget, put money into savings or investments first. Never wait until the end of the month, because there's never enough left over. It's just that way.

6) Really look at what you buy and how much it costs you. Be a smart comparison shopper. For example, we realized that buying stuff at Sam's shaved 20-30% off our monthly grocery budget. For our gasoline purchases, we got a BP card, which saves 5% on every gallon we buy there and gives us rebate checks after enough purchases. Buy 15 gallons of gas today at $3.50, and you've saved $2.62. Multiply that by four trips to the gas station apiece for two drivers, and you've saved about $22 a month. That's $264 a year.

Play the same game for your other purchases. Have cable and telephone? We put our telephone onto our cable. It made zero difference in our telephone service from a practical standpoint, but the package deal saved us about $100 amonth. That's $1,200 a year.

See how it work? Don't just think of your savings on things as one-time expenditures. Project your savings over the course of the year, and let the math convince you.

7) Here's a great trick. When you buy something for any price, double the price in your head and ask if it's really still worth it to you. After all, taxes take roughly 50% of everything you make, so it really costs you twice as much to buy it than you really think. It's amazing how quickly you really don't need that discretionary purchase.

9) Drive the cars until the wheels fall off, which means take good care of them. Cars are probably the single most wasteful expenditure people have. Anybody who buys a new car every five-six years either has money to burn or is an idiot.

8) Once you start accumulating money from your household savings, THEN you can start investing. With that, use your head and be patient. It's a long-term effort on your part, not a short term endeavor.

[Buckhead_Broker]

Well, it first depends on what you consider wealth. For some, a few hundred thousand would suffice. For others it's a few million. Yet others may say its tens, or hundreds, of millions.

There has been lots of good advice presented here. My two cents worth is that you first need to define your needs. How much do you really need? Is tremendous wealth in and of itself worth sacrificing family time to acquire if you don't have a real plan for its use.

To that end, it is very hard to acquire meaningful wealth working inthe rank and file of corporate America. Unless you reach a level where stock options are a large part of your compensation package, a 401K is too limiting - although I'd still recommend you have one and contribute the maximum.

More people in this country have built wealth through real estate than any other investment vehicle. The tax laws are in your favor and it is one of the only investments where leverage is considered safe and normal - compared to buying stocks on margin. And its something you can do while keeping your day job.

The problem is that it is very very difficult to find worthwhile courses or books on investing in real estate. Most I have seen are the "get rich quick" types, including Rich Dad/Poor Dad and that variety. To build an understanding of real estate investing, I would look into courses offered by the Certified Commercial Investment Member (CCIM) organization. Many years ago I took the CI 101 and CI 102 courses which dealt with Financial Analysis for Commercial Real Estate Investment and Market Analysis for Commercial Real Estate Investment. They provided a good foundation for investments I made later.

To illustrate the point, my Dad worked a middle manager corporate job his entire life, but amassed a portfolio of real estate approaching $10 million that provides very well for him in retirement. But the first thing he did was go get an education about real estate and chose his investments very wisely.

I'm convinced you, or anyone else, can do the same thing!