The journey to wealth creation is a fascinating one, often marked by numerous twists and turns. You may be surprised to learn that people living in your neighborhood may have accumulated significant wealth while earning less than what you’d anticipate as required for such affluence. Wealth isn’t always the product of significant earnings but is largely influenced by an individual’s ability to manage their finances prudently. This brings into focus the age-old wisdom stating,

“It’s not about how much you make, but how much you retain.” In this narrative, we will delve into some fundamental personal finance concepts that can guide you on the path to sustainable wealth creation.

First and foremost is the concept of “Net income,” which forms the foundation of your financial planning. Defined as your income after necessary subtractions including taxes, insurance premiums, and other similar expenditures, your net income should guide your expenditure decisions. It is extremely crucial to have a clear understanding of your net income.

From this ‘net’ amount, it’s important to set a budget based on the money in your bank account and not the figure on your paycheck. Aside from your primary income source, exploring avenues for additional earnings can assist in boosting your overall financial well-being. Generating a supplementary income or ‘side income,’ as it’s typically known, can offer substantial financial benefits which…