3 Actionable Steps for Building Wealth, According to Financial Author Anthony O’Neal
Written by
Terence Loose
Edited by
Ashley Barnett
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Not many financial advice experts have the kind of debt-to-doing-fine story that Anthony O’Neal had. Growing up in a financially challenged family, O’Neal found himself homeless, kicked out of college, with $25,000 in credit card debt at age 19.
But as he posted, “It’s not what you’ve been through, it’s what you’ve learned from it.” O’Neal learned a lot. Over the next few years, he turned his life around, educated himself on finances, got himself out of debt and became financially stable. Eventually, through the desire to help others, he transitioned to becoming a full-time financial author, YouTuber, and personal finance speaker.
But you don’t have to be down to your bottom dollar to benefit from O’Neal’s practical, straightforward advice. Here are three actionable steps he recently shared on how to build wealth.
Create a Clear Financial Vision and Target a Wealth Number
You need a clear understanding of your income needs during retirement. Otherwise, saving for financial independence becomes guesswork. So, O’Neal said, you need to establish a “Wealth Number,” which is the total amount of savings you’ll need to retire comfortably. While he said the average is $1.6 million, this number is different for everyone.
O’Neal suggested using this formula: The Amount You Need Per Year/4%. So, based on your lifestyle and needs, establish how much you need per year to retire with the lifestyle you’d like and divide it by 4%. That is your targeted Wealth Number, which you can begin saving and investing towards. For example, if you think you will need $100,000 a year, your target is to save $2.5 million to retire comfortably (100,000/0.04).
Tackle Debt Using the Snowball Method
O’Neal is a big advocate of paying off debt, which he sees as a major roadblock to wealth management. And while there are many methods to tackle debt, O’Neal is an advocate of the “Snowball Method.” With this approach, you pay off your smaller debt amounts first, no matter what the interest rates are.
O’Neal believes this gives you a psychological boost and encourages you to stick with your plan and tackle the higher debt balances. “As you eliminate smaller debts, you gain momentum, which can be incredibly motivating,” he wrote.
Educate Yourself and Seek Mentors
O’Neal credits financial education and financial mentors with turning his life from naive poverty to enlightened wealth-builder. He lists financial education as fundamental to building wealth. He suggests starting with reading books such as “Rich Dad Poor Dad” by Robert Kiyosaki and “The Millionaire Next Door” by Thomas J. Stanley.
But, O’Neal believes, building wealth demands more than reading a few popular books. He suggested taking courses on debt management or investing. “I recall the first time I invested in financial education; it was a game-changer,” he wrote in a recent post. “The knowledge helped me make more informed decisions and avoid costly mistakes.” Finally, he suggested seeking out mentors who have “walked the path before you” to offer guidance and wisdom.
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