"Compound interest is the way to get rich," says Amber Jamieson, 33, a reporter at BuzzFeed and author of the popular weekly financial newsletter "Better Have My Money." Jamieson recently spoke with Grow about her newsletter and how she came to the realization that regularly saving and investing her money was the path to wealth — despite the fact that she had very little to start with.
"Investing is the way to make money," she says. "My income will never be that huge, but I can take what I have and make it grow."
Here are a few strategies for making your money grow, too.
Video by Jason Armesto
There's no secret formula for growing your wealth using compounding. It's simply a matter of saving on a regular basis and allowing time to do its work. That said, you'll want to have a financial plan in place, including a budget, so you know how much you can afford to put away on a weekly or monthly basis.
Once you know how much you can save, it's important to get started. Here are three tips to keep in mind if you hope to build wealth and your net worth over the long term:
1. Start early — and if you haven't started yet, do it now. Having procrastinated is investors' top regret, and the longer you wait, the more FOMO you'll feel. That's because, the longer you wait to start investing, the more money you have to put away.
"Millionaires are made in their 20s and 30s, not their 50s and 60s," Fred Creutzer, president of Creutzer Financial Services told Grow last year. "If you wait until you're 50, you're never going to catch someone who started at a young age. When it comes to investing, the early bird always gets the worm."
2. It's OK to start small. One thing many would-be investors worry about is that they don't have a lot of money to pour into a portfolio. Don't let that dissuade you, though. If you start young, even saving a few hundred dollars per month could make you a millionaire by retirement.
3. Compounding is about time in the market, not timing the market. Experts say the smartest strategy is to save and invest consistently and for the long term — so once you put some money away, don't pull it out again in a few months. Your patience will be rewarded: If you give your money time to grow and compound now, you're far more likely to end up able to retire comfortably and otherwise achieve your goals.
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