Everyone wants to become rich and retire comfortably, but the path to financial security and long-term wealth isn’t as simple as you might think. Just working hard at a great job won’t get you there. Here’s why, and what to do instead.

Why hard work and saving aren’t enough

It would be nice if we could just go to work every day for however many years that we can and then just retire, but it doesn’t work that way. Even if you work hard and save carefully, you will almost certainly find yourself short of cash at retirement — unless you do a few other things.

The reason for this is inflation. Over time, our cash loses its purchasing power. If you’re sticking your cash under the metaphorical mattress, you’re robbing yourself. You need to find ways to keep the value of what you’ve earned, not the number of dollars.

Generating interest

The key to countering inflation is to generate interest on the cash that you’ve saved. Cash in your wallet doesn’t generate interest, of course. Cash in your checking account won’t do much for you, either.

But savings accounts are better. And better still is cash in investing accounts. You should take full advantage of tax-advantaged accounts like 401(k)s to save for retirement. Harness the power of the market with a slow-and-steady growth strategy. If you have a little extra cash, you could get more aggressive.

Investing risks and rewards

When you invest in a company, you’re effectively betting on its future value as perceived by your fellow investors. When you bet on a big company like Apple, you can be reasonably sure that you won’t lose all of your money — Apple is not going out of business anytime soon. Pick a bunch of companies like Apple (across diverse industries), and you’ll probably see your nest egg grow slowly and steadily with the economy at large. You’ll have low risks and modest rewards (and this is what you should do with the bulk of your retirement savings, especially as you grow older).

But if you want to, you can target more volatile companies and investments. With these, it’s harder to tell what will happen — and movements in value can be huge. There are also ways to use rapid-fire trades to make betting on big companies riskier. Why get riskier? In investing, more risk means more potential rewards. If this appeals to you, you might be cut out for the fast-paced life of a day trader. Just be sure to do your research: Choose the best day trading platform for you and make sure that you know everything that you can about the investments you choose. Always keep an emergency fund, keep your aggressive growth strategies away from your retirement accounts, and don’t over-leverage yourself.

Assets and long-term wealth

Your wealth isn’t just measured in dollars and cents. It’s also measured in the value of your assets, especially those assets that may appreciate or those which can help you save money. The classic example is your own home.

If you own your house, you don’t have to pay rent. You’ll probably have to make mortgage payments instead, but not forever. Those mortgage payments give you more than a place to lay your head for a month because you’ll be paying into an asset that you own (and can later profit from if you sell).

Using debt wisely

Acquiring valuable assets sometimes requires going into debt. Debt can be very dangerous, though, so you need to know how to use it (and when to avoid it entirely).

A fixed-rate or variable home loan can be a great thing for your long-term finances (check with financial advisors and experts for which form of interest rate is best in your situation). Relatively low interest rates, tax advantages, and the fact that you’re acquiring an asset that may appreciate all make this type of debt “good debt.”

But steer clear of “bad debt,” which is the toxic short-term type that you’ll find in payday loans. This sort of debt makes interest work against you in extreme ways, and can do serious damage to your long-term financial future.

Growing your wealth is a long-term project. It takes hard work, but it also takes a lot of know-how. Make smart decisions, use interest to help you instead of hurt you, and plan for your future.