There's a popular saying in the world of money management: "Live like no one else, so later you can live like no one else."
Sound redundant? What it means is that in order to be prosperous, we must depart from the beaten path. Instead of doing conventional things with your money, do something extraordinary – and you'll see extraordinary results.
Most People : Rack up credit card debt while they're in college. More than 96 percent of graduate students and 70 percent of undergrads have a credit card, and of those, more than 90 percent don't pay the bill in full each month, according to a new study published in the International Journal of Business and Social Science.
Off the Beaten Path : If you can't pay for an item NOW with the cash sitting in your checking account, don't buy it. It's a radical idea.
Most People : Graduate from college and spend every cent from their first real-world paychecks.
Off the Beaten Path : Socking away $5,000 per year ($416 per month) in a Roth IRA at age 22, instead of age 30, will yield you an extra $1.4 million dollars by the time you're 65. That's right: those extra 8 years of investing will net you a cool $1.4 million, if the market performs as it has been and you follow a moderate-growth investing strategy, according to Fidelity's MyPlan.
Remember: the majority of people don't have a million-dollar retirement portfolio. Creating one requires making moves that are off the beaten path.
Most People : Buy more house than they can afford and struggle to make the mortgage payments.
Off the Beaten Path : Buy a smaller home than you can afford, with easy mortgage payments, and invest the additional money on buying rental properties or dollar-cost averaging into the stock market. Alternatively, you could continue to live with roommates even after you're a homeowner, as I do. My roomies pay my mortgage, and I invest the money in buying more rental units.
Most People : Dream about taking risks – perhaps traveling the world or launching a business – but never take the first step.
Off the Beaten Path : Take the first step! A journey of 1,000 steps starts with the first one.
by Paula Pant