You may have heard the saying pay yourself first. So that is exactly what the purpose of the wealth account is. So the objective is to make sure that you are saving a budgeted amount every month and generating a sizable return on that savings. A great way to do this is to set up a completely separate account. I like using crypto.com as there is the potential to earn high interest on your savings. In recent years the Federal Reserve has started printing trillions of US dollars. This reduces the purchasing power of the dollar due to the expansion of the money supply. So in order to protect themselves against the loss of purchasing power, many wealthy people choose to hold assets instead of cash. An asset is something that puts money in your account. Assets provide cash flow which helps to supercharge the wealth-building process. The name of the game here is cash flow.
If you want to learn more about the importance of owning assets check out my blog on “The Only Thing Earned Income Should Be Spent On”. I believe in trying different things and starting small, then scaling up the solution if it is profitable. There are 8 steps to setting up and automating this wealth-building process.
- I set up an account at Crypto.com. The reason I chose this particular exchange, is that if offers great rewards, as well as perks and high returns on loaning out crypto. A link to get you started can be found here. Note: If you sign up using that referral link we both get $25.
- I then contacted my employer and gave them the checking and routing numbers to set up a direct deposit. This way a portion of my paycheck goes into the account every pay period in order to automate this wealth-building process.
- The next step is to decide on what crypto assets to buy. In my opinion, there are three major Crypto assets that I focus on: bitcoin or BTC, ethereum or ETH, and the third is USDC or a “stable” coin that tracks the US dollar. All of these are cryptocurrencies and each has its own purpose and narrative. The important thing to understand is that (at the time of this writing) BTC and ETH are the top two in market-cap in the Cryptocurrency space. They are considered “Large Cap” Cryptos. USDC is a token originally based on the ethereum blockchain but is now supported on other blockchains as well. The reason USDC is called “stable” is that it does not experience the same volatility as other cryptocurrencies as it is essentially pegged to the dollar.
- Next, is to purchase crypto assets you have researched and determined are a good investment.
- Once you own crypto you can then use the Crypto.com app to enter into Earn Contracts. This is a great way to earn a passive income from the crypto you own turning them into assets. The minimum amount of BTC you can put into an earn contract is 0.005 BTC at the time of this writing. Keep in mind that because the funds are locked up in Earn Contracts it reduces your ability to quickly sell the assets that you have locked up this way.
- Another great way to automate this process is to go to “recurring buy” in your account in the crypto.com app and set up recurring buy orders. You can currently make up to 5 recurring purchases with a minimum of $50 USD per purchase.
- Now that your assets are making passive income, (up to 8.5% on cryptos and 14% on stable coins) it is important to check back on your account every pay period to make sure the funds that were direct deposited clear and that the recurring by orders were placed, if created. Also, if you choose to set up Earn Contracts these may need to be updated based on the duration of the earn contract.
- Make sure to turn on notifications in the app so that it notifies you when your interest has been deposited in your account (typically weekly).
That’s it. You are now an asset investor and are on your way to building wealth. If you found this blog helpful, be sure to leave a comment. If you have questions please leave them below.
Disclaimer: I am not a registered investment, legal, tax, or financial advisor. All investment /financial opinions expressed in this post are from the personal research and experience of the owner of this account and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur. It is very important to do your own analysis before making any investment based on your own personal circumstances. You should take independent financial advice from a professional in connection with or independently research and verify the information that you find in this post to rely upon, whether for the purpose of making investment decisions or otherwise. I own the assets mentioned in this article and reserve the right to buy or sell those assets.
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