Founder of $7.5M Company Shares Her 3-Step Formula for Building Wealth
Building wealth can feel complicated, but Tori Dunlap, founder of Her First $100K, said it comes down to three straightforward moves that she's used to build her own $7.5 million business.
"The financial industry wants it to be complicated — because complicated is where they make money," she wrote in a LinkedIn post. "It isn't complicated. It's just sequential."
Discover More: Warren Buffett's 16 Life Hacks That Anyone at Any Income Level Can Use
Check Out: Start Growing Your Net Worth With Smarter Tracking
Here’s the three-step formula she follows — and why the final step is where most people fall short.
Tori Dunlap's 3-Step Wealth Formula
Dunlap said that building wealth comes down to three steps:
Earn more.
Spend intentionally.
Invest the gap.
"That's it," she said. "That's the whole thing."
While each step matters, the real power comes from how they work together.
Step 1: Earn More To Widen Your Financial Gap
The first step is increasing how much money you bring in. That could mean asking for a raise, building new skills, switching to a higher-paying job or starting a side hustle.
The goal is to "increase the gap between what comes in and what goes out," Dunlap explained.
Step 2: Spend Intentionally To Avoid Lifestyle Creep
The second step is spending intentionally. That means deciding where your money goes before you spend it on lifestyle upgrades.
"A raise means nothing if lifestyle inflation absorbs it," Dunlap said.
A practical way to do this is by building a budget that prioritizes long-term goals, including regular contributions to investment accounts. Ideally, you'll automatically direct extra money into investments.
"Automate, so the gap goes somewhere before you can spend it," Dunlap said.
Step 3: Let Compounding Grow Your Money for You
Over time, those steady, automatic contributions can grow significantly thanks to compounding.
"Leave it alone and let compounding do the work," Dunlap said.
The Mistake That Derails the Formula
"The mistake most people make isn't spending too much," Dunlap said. "It's not investing the gap when they have one."
When income increases, it’s easy to upgrade your lifestyle or keep that money in a bank account instead of putting those extra funds to work.
"A windfall means nothing if it sits in a checking account," Dunlap said.
Without a system in place, higher earnings don’t automatically lead to long-term financial progress.
"The gap is the lever," Dunlap said. "The automation is the lock. Everything else is noise."
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
More From MoneyLion: