Wealth is not earned but created! What we mean to say that wealth is not just about the inflow of money but about nurturing, managing the money that you have earned and growing it. Creating wealth is simple. It doesn’t require very high intelligence, a great amount of luck or any special connections. As John Bogle wisely stated, “The secret is there are no secrets”.

It is a fact that most of us will rarely attain financial independence in our lives. The problem lies in our mindset /approach. We can create wealth if only by consciously and consistently working on these three things over many years, decades. The passion and focus must be on increasing the difference between income and expenses and saving/investing that difference and let it grow with the power of compounding over time. That’s it.

Warren Buffett, undoubtedly the greatest investor of all time, once said, “Do not save what is left after spending, but spend what is left after saving.” Most of us live through life spending most of what we make. We spend on things like big houses, cars, life-style, holidays, family events and so on. At most, we end up building a small nest egg or rely on the government pension to support us in retirement.

It is important here to understand that we are not saying that we become too materialistic here. You should not love money or wealth itself, but the game of making money. It is all about what is your priority and goals in life which cannot always be associated with any number. The idea is to break the cycle, the dependence on wealth, and reach a level of self-sufficiency where you are free to do what you like.

Wealth creation at its core is a simple three-step process 

Step 1: Earn more

This may sound simple and naive, but the idea is deeply profound. The idea is to consistently focus on

  1. Increasing your income 
  2. Building multiple sources of income, preferably.

These points are self-explanatory, and we will not go into details. The advantage here is that there is no limit to how fast or to what limit you can do this as one’s earning capacity is practically unlimited. What limits us though is our self-image, belief, focus, commitment, skills and our environment. Fortunately, again, everything which either under our control or something which we can change/improve.

One thing common among successful rich people/businesses is that they nurtured & built multiple sources of income. We should stop relying only on one source of income, either a job or business. Learning new things, upgrading skills or building new businesses to stay competitive are things that ensure we are not behind competition or end up losing our job or facing business loss. If you are not doing this right now, note that you are falling behind.

Step 2: Save More

Frugality is about self-discipline and living on less. For most people, this is tough as if they are sacrificing something and feels like compromising on life and their standard of living. Living in this bubble makes it difficult for such people to achieve their financial independence as they are in a continuous battle making the choice between desires and financial goals.

For many others who have adopted a simpler life, frugality or simplification gives pleasure. There is a sense of freedom, escape from the clutter of home and life. A sense of contentment can be felt even with lesser things and especially when money is directed towards financial freedom goals rather than on things that do not hold any real value or add to your financial standing. It’s not uncommon for such people to save over 70% of their income and achieve financial independence even in less than 10 years!

Step 3: Invest Wisely

The process of investing in assets is crucial in creating wealth. However, investing is not always straight forward, and an individual should therefore have a strong understanding of their investment choices and decisions. Our knowledge and experience dictate our investment behaviour and the quality of the financial decisions we make. Everything you need to learn is available for free in the public domain. However, one short-cut we can take here is to associate with a trusted distributor or the right financial advisor /expert and follow their guidance.

There are many aspects of investing wisely and successfully. However, it takes time and there is no get rich quick scheme or idea here. Simple principles like starting early, investing regularly, choosing the right asset class, diversification, taking calculated risks and not making costly mistakes are just some of them.


In brief, the goal of wealth creation is not new but rarely followed with the right actions and mindset. The points highlighted is universal knowledge an simple and easy to follow. If only we could live by these ideas and follow them consistently over years and decades, financial well-being or independence will not be far away from us.