You don’t need to be rich to start creating generational wealth for your family! Getting started is the most important part – you just need to take a few small steps that are quick, easy and best of all, don’t require a big bank balance! Here’s how to get started!
Improve your financial knowledge
Take the first steps on your wealth building journey and sign up for the financial education course from Truth About Money. You will learn how to manage your money, get out of debt, and save and invest. The course will teach you how to live within your means so you can free up some funds to start building wealth.
You will need an internet connection, some data and some time, but the course is free, and you can do it in your own time and at your own pace.
Teach your children good money habits
Money is a big part of our lives, but we need to learn how to manage it well and the sooner the better! Teaching your children good money habits is giving them an important life skill that will help them to become wealth builders too.
Children learn by example, so you’ll have to set a good example for your family, but also take the time to talk to your children about money. Explain why you said no to something you couldn’t afford and how you could afford it by reducing another item in your budget or saving extra for a few months! Share the price of everyday items so your children learn the value of money and how much a paycheck buys. Also share your wealth building plans, and why and how you are saving and investment money. Finally, encourage your children to track their savings and spending so they know how much they have and what they use their money on.
Start a side hustle
How does R500 extra a month sound? Good! We like it! Why not find it in a side hustle? We know you’re creative and determined to manage your money well, which means you can find something you are good at, start a small business and make a few extra rands. Don’t overcomplicate it, just make sure you are making a small profit after covering expenses. And don’t worry if an idea doesn’t work – just move on to another one.
You can use the extra funds you earn to boost your budget, pay off debt and save or invest!
You can find some tips in Golden rules for starting your side hustle.
Pay down debt
This will free up funds in your budget that you can use to create generational wealth. And you’ll reduce your financial stress!
Work out a plan to pay down your debt and commit to it. For example, start paying off short-term debt such as credit cards and personal loans as these have the highest interest rate. You can find top tips for paying off debt in Your 10-step plan to getting out of debt.
Top tip: If you are struggling to pay your debts each month in full, you can apply for debt counselling to help you manage and pay your debts. You can learn more about debt counselling in 7 things you need to know about debt counselling.
Change your lifestyle from wants-based to needs-based
You might want something, but do you need it? That big, flashy new car next door looks good. But it costs a lot, comes with high insurance premiums, uses a lot of petrol, and is hard to park in small spaces! The same goes for large homes and new model phones, fancy furniture, outsize TVs, and exotic holidays.
Work out what you really need in your life and not what you want, and then look at what you can afford. For example, a car costing no more than Rxx per month that gets you safely from A to B and is economical (cheaper to insure and run - the less petrol the better!) and spend accordingly.
Changing your lifestyle is hard, especially with so much peer and Instagram pressure. You don’t need to close your social media accounts when you change your lifestyle, just be open and honest about the changes you are making. Tell your friends and family you’re living a needs-based lifestyle not a wants-based lifestyle and you’re saving lots of money doing it.
When you cut back and spend on the essentials, you will notice your budget is no longer stretched and you’ll have a few spare rands at the end of the month. Long-term, you’ll be able to save and invest more, and create generational wealth for you and your family.
Building generational wealth isn’t only about money!
With these great habits, you’ll soon have extra funds available that you can use to build your generational wealth. And with your money smarts you’ll manage it well, so future generations of your family will also benefit!
Frequently asked questions
Generational wealth refers to the accumulation of assets and financial resources that can be passed down to future generations within a family. To start building generational wealth without any money, you can take a few small steps such as improving your financial knowledge, teaching your children good money habits, starting a side hustle, paying down debt, and changing your lifestyle from wants-based to needs-based.
You can improve your financial knowledge by signing up for a financial education course from Truth About Money. The course is free and will teach you essential skills like money management, debt reduction, saving, and investing. All you need is an internet connection and some time to complete the course at your own pace.
Teaching your children good money habits is essential for their financial well-being. Lead by example and talk to them about money regularly. Share your budgeting strategies, explain why you make certain financial decisions, and involve them in discussions about savings and investments. Encourage them to track their spending and savings to understand the value of money and how to manage it responsibly.
Starting a side hustle doesn't have to be complicated. Identify your skills and interests, and find a small business idea that aligns with them. Make sure your side hustle generates a small profit after covering expenses. If one idea doesn't work out, don't be discouraged—try another one until you find the right fit.