When it comes to building wealth, the best approach is to avoid trying to get rich quick and embrace a get-rich-slow mindset.
Money expert Dave Ramsey once tweeted that he found research indicating that the No. 1 correlating factor of people who build wealth by investing is “that they actually invest.”
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What does it mean to actually invest? Here’s how Ramsey says investing can help you build real, lasting wealth over time.
What It Means To ‘Actually Invest’
In the video accompanying the tweet, Ramsey shared the four types of mutual funds he invests in: growth, growth and income, aggressive growth, and international — along with his investment strategy.
“I invest in those in up times, in down times, in all times,” Ramsey said. “I never stop.”
To be actually investing means to consistently invest. Ramsey implies that the one thing savvy investors should do is simply not stop investing. Start investing and keep investing — no matter what.
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What Does It Mean To Invest in Mutual Funds?
Mutual funds are professionally managed investments that allow investors to pool their money together to invest in something. A team of professionals works to pick and choose which stocks, bonds and other investment options are included inside mutual funds.
Mutual funds made up of stocks are known as stock mutual funds while those consisting of bonds are called bond mutual funds. In addition to the growth funds mentioned by Ramsey, there are many other types of mutual funds. Some of these include value funds, income funds, index funds, money market funds, sector funds and hybrid mutual funds.
By investing in mutual funds, you’ll receive three benefits that will help you build wealth. According to a Ramsey Solutions blog post, these benefits include instant portfolio diversification, lower costs and active management due to mutual funds being run by a team of investment experts.
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This article originally appeared on GOBankingRates.com: ‘Get Rich Slow’: Dave Ramsey Offers the Key to Lasting Wealth
