HOW TO BUILD A FORTUNE.
Turn idle wishes into energetic action and the thing is accomplished.
We begin to build a fortune, not with money but with thought.
It has been said many times that it is far easier to earn money than it is to save it. This statement is true, and the truth of it should suggest the fact that as a man earns only by the application of thought and labor, so he saves only by the same application. Saving is a process carefully to be consid ered, studied, and put into working order. Any man who has given the problem the thought it deserves will have discovered two facts: (1) All saving results from spending less than one earns.
(2) The potentiality of money saved to day depends entirely on the manner in which it is laid out in order that it may earn more money in the future. In other words, we must be ever mindful of Benjamin Franklin's famous dictum: "Money earns money; but the money, money makes, earns more money." Every man, intent on saving for the future, must take unto himself indispensable part ners. They are Industry, Perseverance, and Time.
Industry insures the creation and perpetuation of the general earning fund from which savings are made.
Perseverance insures the continuous operation, the onward motion of the saving plan.
Time is the factor that permits money to develop and to increase its interest earning power.
Who can save ? Everyone who earns.
This may not seem, at first sight, to be so. But the truth of it has been demonstrated so often that we should no longer doubt it. The amount saved from time to time may be small, but when small savings are brought un der the influence of Perseverance and Time, they become significant. The story is told of a New Hampshire fanner who set aside every day for fifty years, a five-cent piece, depositing each dollar as he accumulated it, in a savings bank. He began to do this at eighteen. At sixty-eight, he has to his credit, two thousand, nine hundred dollars—a sum that earns annually, at five per cent, one hun dred and forty-five dollars, or eight times the annual amount he deposited.
The average earner of money, whether the annual income be large or small, must re solve that some of the so-called pleasures that may be bought with money to-day, be given up, in order that their cost may be set aside to buy necessities in the future when the working capacity has been reduced by the passing years. Few are willing to do this. The desire to possess Now everything that money will buy, whether it be needed or not, is the one great cause of old-age poverty.
Even the man who is entirely free of re sponsibility toward others must take into ac count the fact of his responsibility to his own future. A man whose wages are as low as ten dollars a week, or five hundred and twenty dollars a year, would require to invest at five per cent, a fund of ten thousand, four hun dred dollars to assure himself of the same income in old age. Thus : A family, the head of which earns ten thousand dollars a year, would require in the event of his death the income at five per cent on a fund of two hundred thousand dollars, to continue to live as they had. This shows that working power has a capitaliza tion value far above what we realize. It is on this value that a man should base all his calculations of expenditure and saving. He may never accumulate the full amount of his capitalized value, but he must accumulate something that will supplement his lessening earning power as the years leave their impress upon him.
Let us take the case of the man who has no responsibilities beyond himself, in order to ascertain how he, as a type of all others, must proceed to begin the preliminary study of saving. How shall he adjust himself to ward money so that he may learn to make a logical apportionment of his income? If he holds that he must not live on the bounty of others, but by his own exertions, he will find that he must count on four funda mental expenses, not three, as is usually the case.