by Natalia Jones

Created on: May 06, 2009   Last Updated: May 10, 2009

Truth be told getting rich one dollar at a time doesn't cause blood to rush to the head with excitement and it definitely isn't as alluring as the trendy get rich quick counterpart, but maybe this level-headed approach is more valuable . The bookstores now dedicate entire sections for self-help books on how to become The Millionaire Next Door or how to Start Late and Finish Rich, but when you strip away the catchy phrases and the innovative money-making spins, what they are all based on is good solid financial common sense.

The following tips will help you to end up where we all want to be.. comfortably rich in our golden years.

1) Live below your means. Never mind the Joneses, maybe they can afford two vacations a year and a new car every three, but if you know that you can't, don't feel the need to compare yourself to them. Every family must work within a budget that fits their lifestyle and their income. Setting aside money for savings is the key to finishing rich and the key to making it materialize is making it automatic. Set up standing orders at the bank that moves some of your paycheck at the end of every month to a special savings account. It is easier to adjust to spending less if you don't see the money available in your account, so to avoid the temptation remove the funds.

2) Set goals and track their performance. The importance of goal setting in the financial planning process cannot be underscored. Our goals are a vision of what we would like to accomplish and visualizing them makes the bitter process of depriving ourselves some instant gratification for a future prize more palatable. Goals also give an indication of how much we should be saving and what type of investment vehicles we should try as some ambitions may be more stretching than others and thus require a proportionate amount of risk to earn the return that would make achievement of the target possible.

3) Get out of debt. This may be obvious to some, but others overlook the need to be free from debt. Loan obligations can be expensive and they definitely prolong the process of wealth creation. Some loans, such as mortgages are necessary, but it is critical that the balances are paid down as quickly as possible. Debt interest not only exponentially increases the cost of the item that is being financed, but the seductive nature of loan interest is that it is hidden in a monthly installment that disguises the true cost.

4) Educate yourself on personal finance. You work hard everyday to earn money. You know better than anyone else what you would like to achieve in the future. Yet many people find it hard to draw the map that connects them from where they are now and where they would like to be. Budgeting and financial planning doesn't have to be a mystery. You may not be a savvy Wall Street investor but you can certainly familiarize yourself with some major investment vehicles so you can make some informed decisions on where you feel comfortable placing your money.

Taking control of your finances can be an intimidating journey, but if you go in with the proper knowledge and have your path lit up by your goals, you no longer have to feel like you are taking a shot in the dark. You can walk with confidence in your ability to become rich... one dollar at a time.

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