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By Liz Weston / DailyWorth
August 26, 2016

You likely already know the standard advice about building wealth: Live below your means. Max out your retirement accounts. Pay off your debt. But in addition to those tried-and-true methods, there are other, less well-known ways that can help you grow your net worth faster. Here are four:

1. Use a Health Savings Account. These accounts, which are paired with high-deductible health insurance plans, offer a rare triple tax break — your contributions are deductible, your money grows tax-deferred and withdrawals for medical expenses are tax free. HSAs typically allow contributions to be invested in stocks and other investments for long-term growth, and any unused money can be rolled over year after year.

HSAs, in other words, can be used to supercharge your retirement savings. Some advisors recommend their clients funnel savings into HSAs after they’ve contributed enough to their workplace retirement plans to get the full match. Other advisors suggest HSAs as an additional way to save for retirement after workplace plans and IRAs are maxed out.

Read More: 5 Celebrity Money Mistakes We Can All Learn From

2. Buy a modest house in a modest neighborhood. The old-school advice was to stretch to buy a home in the best neighborhood you could afford to maximize your potential appreciation. The problem, as we’ve learned, is that appreciation isn’t guaranteed and historically hasn’t been that impressive.

Yale University economist Robert Shiller, who helped create the widely used Case-Shiller Index to track home prices, found that long-term returns on residential real estate barely keep pace with inflation. Once you factor in maintenance, updates, repairs, insurance and taxes, you may well be losing value rather than gaining it. Paying down a mortgage does force homeowners to build equity, but that will happen even with a smaller home that you can better afford.

Capping your housing payments at 25% of your income, rather than the 33% or more some lenders will approve, should leave you with enough money to save for retirement and pursue other financial goals. Also, research shows living in a more expensive neighborhood will actually cause you to spend more in other areas of your life too, says Thomas Stanley, author of the book “Stop Acting Rich” and co-author of “Millionaire Next Door.” Rather than being an “aspirational” resident — one who’s less wealthy than your neighbors and feeling pressure to “keep up with the Joneses” — people who want to build wealth should live in neighborhoods where their net worth is higher than average so they don’t feel those pressures, Stanley says.

Read More: Think Like a Millionaire

3. Buy fewer cars. The AAA estimates the average car costs $8,876 per year to own and operate, based upon 15,000 miles of annual driving. That’s a huge chunk of most household budgets. But you can save significant amounts of money simply by owning your cars longer. In my book “Deal with Your Debt,” I calculated that someone who buys a car every 10 years rather than every five years would save more than $250,000 over her driving lifetime (assuming the first car cost $20,000, with subsequent car prices adjusted for 3% annual inflation, and that each purchase was financed with a five-year loan at 6% interest). You can save even more by buying gently used cars instead of new and paying for cars with cash, rather than financing.

Read More: 7 Simple Rules for Making Money

4. Fund a Roth. Everybody knows the advantages of Roth IRAs, don’t they? Apparently not. Fewer people have Roths than have traditional or rollover IRAs, according to the Employee Benefit Research Institution’s IRA database, which contains information on 25.3 million accounts and 19.9 million people. Nearly 73% of IRA owners had traditional or rollover IRAs, compared to the 28.1% who owned Roths.

Roth IRAs don’t offer upfront tax breaks, but money withdrawn in retirement is tax free. That’s a huge perk, but not the Roth’s only one. There are no required minimum withdrawals for Roths as there are with other retirement accounts, so the money can be left to grow and even bequeathed, income tax free, to your heirs. The younger you are, the more likely your tax rate will be higher in retirement than it is now, which makes funding a Roth a good bet.

Advertiser Disclosure

The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

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