Leverage is another important concept for wealth building. Leverage in this instance is defined as something to multiply your efforts. With leverage, you get magnified results. The two most common things that are leveraged are time and money.

Here’s an example of time leverage. Bob starts a dry cleaning store. If Bob is the only person working there, then the business can only grow as big as Bob has time and the business only gets 8 hours of benefit per work day. If Bob hires a person to man the front counter, he is leveraging time to get his business the benefit of 16 hours per work day. This allows Bob to grow his business without the corresponding increase in his time requirements. As his business grows, Bob keeps leveraging time by adding employees when they are needed. Soon, Bob can open a second location that runs without his presence. All of this is due to time leverage.

Now, you’re thinking, I don’t want to hire employees because they are a hassle. That’s true, but there are ways to leverage time without employees.

Many home based businesses allow you to develop a team and as a reward, you receive a percentage of products that are moved through your team. If you build your team to 100 members and each put in just 1 hour of effort per day, then your business would benefit from 100 hours of effort.

When combined with residual income, it becomes leveraged residual income and can be the best wealth building vehicle for the majority of people. As your team reaches a critical mass, it then starts to grow on its own without any effort from you.

If you are truly looking for the way to create wealth in your life, choose a vehicle with leveraged residual income.