Creating a money machine, that sounds delicious. What we mean is that you will do something with your earned money, which then makes you money without having to do anything for it. There is really only 1 way to do this, and that is to start investing.
By investing, you reallocate your earned money to a place where it will then do its work for you. Your money is going to make a return. That means that without having to do anything for it, your money becomes more money. Amazing!
Ladies take note! Investing involves risk. You may lose (part of) your deposit. Be aware of the risks and start investing only if it is possible in your situation. Your money can become worth more, but also less. Read more here.
Creating money machine: how to do it?
We are going to take the bull by the horns right away. You want to know how to free yourself financially so you don’t have to go through that time versus money rut for years to come. You want to create a money machine that continuously makes you more money and grows your wealth. For this, some aspects are very important. Because before that money machine is a well-oiled machine that makes you money while you sleep, you have to do something for it.
One, two, step
To enjoy passive income soon, you must start NOW. That first step is crucial! Scary, exciting, but oh so important. Because knowing what you want is not enough. Having the right knowledge to achieve what you want is also not enough. Taking action, no matter how small, is the only thing that is going to help you realize your desires.
Winning with money is 80% behavior and 20% knowledge. ‘What to do’ is not difficult. ‘Doing it’ is.
- Step 1: Get an understanding of your income and expenses. Open your banking app, write down what you spent in the past three months and what came in. Scared to death. And agree with yourself that you will improve your life. At Elfin, we help you take this seriously and create a solid financial statement and multi-year plan. Check out our membership and find out more.
- Step 2: Now that you are going to improve your life, you are going to add two additional fixed charges each month: an automatic transfer to your savings account and to your investment account. What amount is up to you, but also know: that freedom may make you happier in the long run than that dinner or new dress. Start by setting aside 10% of your net income. Read this article on how to budget smartly.
- Step 3: open an investment account. There are many parties where you can open an account, do good research and see if this party has a license to do business in the Netherlands. Finding it hard to choose? Read this article where we help you choose a bank or broker where you can invest your money.
- Step 4: transfer that first $50 to your investment account and buy an investment product. Think stocks or ETFs. Read what ETFs are and how to buy ETFs here.
- Step 5: Be patient. This effect is going to be exponential, both in terms of behavior and effect. As you pay off your mortgage, your monthly expenses shrink, you can invest more, the more you invest, the more you benefit from any dividends, the more income you have, the more you can invest again. Flywheel to the max, creating a true money machine through that whole investing and being smart with your money game!
Want to learn more about how to start investing? In the Elfin membership you get access to the Starting to Invest e-course.
Money Machine
Passive income generation is the way to make money without trading your time for money. This does take time, and mega commitment. If you are very clear about why you want this (and this almost never has to do with money an sich, money is a tool, a means), then the road to it is fun, and not a burden.
Creating a money machine is a long haul, but crucially, get started. Investing is an action that cannot be avoided because investing is the only way to turn your money into more money.
