Financial guidelines to build and protect your wealth

*This content is brought to you by Brenthurst Wealth.By Leslie Greyling*.Is this the year that you decide to make your financial goals a priority?To do this effectively, you must have a positive money mindset to build your wealth. You might have to establish new financial habits and stay committed to them.Start by setting some wealth goals with a timeline to achieve these goals to keep you on track..Financial regrets often only emerge later in life when the impact of decisions made when you were younger becomes clear. Many individuals discover crucial financial wisdom too late in life..Here are a few fundamental guidelines which could drastically alter your financial trajectory and secure a more stable future. These will help you to make better practical decisions..Pay yourself first. Building wealth starts with prioritising savings before spending. Set aside a portion of your income for savings and/or investments. Ideally 20%-30% of your income, but start with any amount, no matter how small it might seem. Keep track of where your money goes, you might realise that you are spending money on unnecessary expenses.Live below your means. As your income increases there is a temptation to spend more. Do not. Rather use this extra money to save and invest a higher amount. Compound interest works both ways. Just as compound interest accelerates growth, it can also work against you in terms of too much debt that increases and becomes more expensive to repay. Every financial decision you make has a time component that must be taken into consideration. An emergency fund is vital.Have 3-6months essential expenses saved in an easily accessible account as provision against inevitable unexpected events in life.Strategic Tax planning.Understanding and utilizing tax advantages as part of your financial plan can reduce your tax burden while building wealth.Debt should be strategic. Differentiate between good and bad debt. – Good debt: a mortgage, your house is an asset. But keep the "good" debt within your means, do not overextend yourself by buying at maximum affordability.– Bad debt: credit cards usually have high interest rates; the debt increases and can become out of hand. Excessive borrowing must be avoided as far as possible..Invest for the long-termStart investing early and consistently as wealth is not created overnight. Long term saving and investment in diversified asset classes is a proven strategy for growing your wealth over time. Earning potential is your greatest asset. Increasing your earnings will provide you with a higher disposable income to save and invest. Build multiple income streams, if possible, for example a side hustle or passive income such as rental property.Protect your wealth You need to protect yourself through products such as Life, Disability, and Critical/Severe Illness insurance. Estate planning and Wills are important strategies to manage risk and ensure you are adequately covering your assets and generational wealth.Financial education.Understanding basic investment principles will enable you to make better decisions and avoid common mistakes. Consult a financial advisor to assist and guide you in the right direction..Good investment decisions and financial management throughout your life will deliver better long-term results for wealth creation, providing you with peace of mind. .*Leslie Greyling, Registered Financial Planner™, is an advisor at Brenthurst Wealth Fourways leslie@brenthurstwealth.co.za..Brenthurst Wealth Management.Read also:.Understand the risks when you choose alternative investmentsInvestment outlook 2025: Navigating opportunities in a year of transformationPreparing your children for receiving an inheritance: A South African perspective

Financial guidelines to build and protect your wealth

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