Am I the only one who finds this whole adulthood experience unbelievable? I can almost hear you say no. This minute, there is a lot of money to spend, the next minute, you are as broke as a church rat. The most painful part of this is the way every other person tells you about investment. This minute, the money is in forex, the next minute the money is in affiliate marketing. If you are like me, you may not even care about the money in forex or affiliate marketing. You care about where people get the money they use to find money from. This question you ask becomes the doorway to the five secrets every youth must know about getting wealthy.
- No One Is Crazy
- There Is Luck and There Is Risk
- Secure Yourself To Get Wealthy and Stay Wealthy
- Obey The 4th Rule of Wealth – Compounding
- Wealth Is What You Don’t See
NO ONE IS CRAZY
Do you know people do very crazy things with their money? There may not be a problem with that, the problem comes when you compare people’s personal experiences with money against your own experience. Because people come from different generations, different parents and different economies, people have different experiences with money. A child who grows in a poor economy thinks about risk and reward in ways a child from a wealthy economy can not comprehend, even if he tries to. For this reason, what makes sense to you about money may not make sense to me. The question of how much you should save, spend or invest depends on who you are and the experience you have with money. If forex works for you, do it. Everyone makes financial decisions as a result of their unique experiences that seem to make sense to them at a particular time.
THERE IS LUCK AND THERE IS RISK
Do you wonder why some people just get fortunate? Come rain, come shine, some people are just lucky. Luck and risk are siblings in the financial world. They give you the proof that there is another force that controls life apart from effort. Some people may get a quick, favourable return on their investment, while you may get no return on the same investment. There are investors that make very bad decisions, but people celebrate them because the result of the bad decision is good. On the flip side of this, there are other investors who make very good decisions, but the results of their decision do not get people to celebrate them. The only issue with luck and risk is that it is impossible to measure or quantify the degree of luck or risk in predicting success outcome. Until you win, no one may believe that you try your best every day. In essence, bad businesses may be due to laziness, but, it is not always so. Luck and risk play a significant role.
SECURE YOURSELF TO GET WEALTHY AND STAY WEALTHY
Do you know that getting wealthy is not the only priority you have? If that is your only goal, there are a million of ways to get wealthy and there are plenty of books on how to do so. But for you to stay wealthy is a different game. For you to stay wealthy, you need to learn how to survive. You can make money by taking risks, being optimistic and putting in the appropriate work. However, you need to do the opposite of these things to stay wealthy. To stay wealthy, try not to take risks, have a bit of fear to guard your money from loss. A rule of thumb of staying wealthy is to avoid ruin at all cost. You can take this as the icing on the cake. You have no reason to risk what you have and need for what you don’t have and don’t need. Do this, and you have the basic rule of staying wealthy. Your ultimate goal is for you to get wealthy and stay wealthy.
OBEY THE 4TH RULE OF WEALTH – COMPOUNDING
Do you remember Warren Buffet? Can you pin the exact secret of Buffet’s wealth? Do you know how many blog posts people dedicate to Warren Buffet’s financial secrets? You will agree with me that there are so many. However, few information sites will tell you a simple fact about Warren. You need to know that Warren is not just a good investor, Warren has been a good investor as a child. To be specific, since 10 years old, and by age 30, Buffet now has the net worth of $1million dollars. Stick with me here. Compare Buffet to Jim Simons, head of the hedge fund Renaissance Technologies. Buffet compounds 22% of money every year since age 10. Jim compounds 66% every year since age 50. Jim is greater than Buffet, but, not as rich as Buffet. How? Unlike Buffet, Jim has less years to compound money. As a result, Buffet financial secret is not just investing. He has time to his favor!
WEALTH IS WHAT YOU DON’T SEE
How many times do you spend money to show people how much money you have? There are many ways you can define wealth. An important one you may overlook is that wealth is what you don’t see. When you judge wealth by what you see, you base your judgement on the information you have in front of you. Take for example, if you see me driving a Ferrari, you may think that I am wealthy, but that is the only information you have. If I don’t tell you I am in debt because of the Ferrari, will you know? That apart, after I tell you I am in debt as a result of the Ferrari, will you still think I am wealthy? Recent financial experts may tell you to fake it till you make it, but the truth is that richness is what you make others see, wealth is what you have with you after you tell others how rich you are. Wealth is what you can’t see. Apply this rule when judging others, and to yourself when you make financial decisions.
All in all, it is not the forex trader or the affiliate marketer that has the money. For you to do well with money, it has little to do with how smart you are. It has a lot to do with your behavior towards money and staying wealthy. The key point here is for you to know that you create your own experience of money. Whatever your experience is, know that you are who you are and your experience is just 0.00000001% of how the financial world works.