How to Become a High Value Person in 2022
December 31, 2021
“High-value” has been around for awhile, but it has recently surged in popularity on social media. It’s created a lot of controversy, and more questions than answers. We’d like to “flyp” our two-cents in the discussion.
What is a high-value man or high-value woman?
Though the term is typically used in conversations surrounding dating and relationships, we’ll explore it through a financial lens (we’re a financial app after all).
How Flyp Defines “Financially High-Value”
A “financially high-value” person is someone financially stable, financially confident, and can serve others in business and their personal lives.
Whether it’s through creating new business opportunities, supporting a family or charity, or helping a friend in need, a financially high-value person strategically uses their wealth and income to help others succeed.
Here’s how to do it.
How to Become a Financially High-Value Person
A high-value person’s financial life enables them to be a benefit to other people. So, the key to becoming financially high-value (from a financial standpoint) is to get your finances together. Start by laying the groundwork.
1. Set Money Goals
Building the tallest skyscraper or biggest mansion requires a solid foundation first. Your financial goals do, too. And, the foundation of your best financial life starts with goals, and commitment.
Find Your Financial Why
What are your financial goals or resolutions this year? “Making money” isn’t enough.
Looking to splurge on a nice vacation? Buy a new car, first home, or get out of debt? Become a millionaire? No matter how big or small your goal seems, you can do it, but you’ll need to commit first. Write it down if you have to. A tangible goal keeps you focused and gives you something to strive for as you are building your financial foundation.
Remember, this isn’t a popularity contest. Keep your financial goals specific to your life. This isn’t about posting cool Instagram photos (but it’s okay if you do) or comparing yourself to others. This is about living your best financial life.
2. Saving—Your First Money Move
Once you know what you want for your money, you can take action.
The financial world may seem complex, but financial success boils down to two basic things: saving and investing.
Saving money helps you in the short term, and investing helps you in the midway to long run. Let’s break it down.
Why is Saving Important?
Saving gives you the breathing room you need to protect yourself in an emergency, then have the opportunities to have your money work for you. But if you’re constantly worried about living from paycheck to paycheck, or just covering your monthly bills, putting your money to work for you isn’t even on your radar.
It All Starts With a Basic Budget
A monthly budget is the best way to see your monthly spending and find out how much you’re saving after every paycheck. Without a budget, you’re flying financially blind.
A budget doesn’t have to be complicated. The important thing is to have a basic view of where your money is going. Whether you’re spending too much on your car payment or pumpkin spice latte, your budget helps you find out.
The first goal of saving is to have money left over after paying for essentials (rent, utilities, bills). You should be able to save some and have a little fun. Soon, living paycheck to paycheck will be a thing of the past.
Bulletproof Your Bank Balances With an Emergency Fund
With money left over, you can transfer it into a savings account, so the money can be separate from your spending account. Repeating this process will help the money pile up!
In just a short time, you’ll have sweet emergency savings!
Your emergency savings should have about 3-6 months’ worth of money for rent and basic expenses. If you unexpectedly change jobs, need to fix your car or any other money emergency, you’ll still be covered.
Saving alone isn’t enough to create wealth, unfortunately. But, with your emergency savings in place, you’ll be safe if you run into an emergency. You’ll also be in a good position to start investing.
3. Invest, So Your Money Can Run
You cannot build wealth if your money isn’t working for you. Period. The key to making this happen is to invest—consistently.
Why Should I Invest?
Here’s why: suppose you saved (not invested) $300 per month. $300 dollars a month is $3,600 dollars a year. Saving $3,600 a year for 15 year adds up to $54,000.
But, let’s say you invested that $300 in an average-performing mutual fund, and made just 6% per year. (which is below average for the stock market). Your $300 per month will add up to $3,600 each year, then comes a boost—the compound returns. Compounding is a positive cycle where the money you make from an investment is reinvested, giving you a chance to multiply your financial growth again and again over time.
After that same 15 years, you’d have over $83,000! This is the power of compound returns.
What about after 20 years? Or 40 years? Imagine the difference these numbers could make in your financial stability in the future.
How to Start Investing
How do you start investing? Keep it simple. Sometimes, the simplest strategies are the best ones—especially for your money.
Do you have a 401(k) at work? That’s a great place to start. All you need to do is sign up and pick how much money (automatically) goes from your paycheck to your personal 401(k). While you’re at it, does your 401(k) have a matching policy?
A 401(k) match is a special agreement where your employer rewards you with extra money in your 401(k), by “matching” a small percentage of how much you put into the account. In many ways, this is “free money”
If you’re unsure of how much to save, start with 2-3% of your paycheck, then increase it gradually. Aim for at 10% or more over time.
No 401(k)? Open a basic brokerage account or individual retirement account (IRA) (for the long-term). Look for companies that charge no fee to open an account, and have no (or a very small) minimum investment.
What Should I Invest In?
Buying individual stocks can be expensive, and difficult. When you’re first starting, one helpful option is to put money into your investments little by little, without taking on too much risk.
Let’s say you wanted to own Nike stock, which costs around $160 at the time of this writing. To buy just 50 shares, you would need to pony up around $8,000! This is also risky because putting all your money in one company means that you rely solely on that company’s success! Some helpful ways to get around this would be to buy smaller “slices” of your desired stock in fractional shares, or purchase mutual funds.
A mutual fund is a ‘basket’ of stocks that all trade as one. They have minimums as low as $10, and can be a great way to dip your toe into investing. You can start with a small dollar amount each month, putting the money in a conservative mutual fund, and you’ve started your financial engine!
Having a savvy saving and investing plan ultimately puts your money to work for you. Over time, hundreds of dollars become thousands, thousands will become tens of thousands, and so on!
You Can Improve Your Financial Life
No matter where you are with your money, you can take action today to start improving your financial life.
To make the best financial choices, always circle back to your original goals, and choose what helps you maximize your savings or financial growth in the long run.
This applies to your bank, too.
Get Flyp, the Digital Finance App That Wants You to Succeed
When it comes to your money, we believe that your bank matters a lot. That’s why Flyp is here to help you reach your financial goals.
Our debit card has no hidden fees, no account minimums, and no overdraft fees.
Plus, you can use the Flyp digital banking app to get game-changing debit card rewards, like 110% cashback from a simple debit card purchase.
We want to make sure that you and your money are taken care of. With Flyp, you’ll be high value (and loving it!) in no time.
Flyp is not a bank. Banking services provided by Sutton Bank, Member FDIC.
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