Getting wealthy is not about being flashy, extravagant, or owning expensive things. Becoming wealthy should be boring…and that is a good thing! I retired at age 38 and am now approaching 50 years old. I have done non-profit work, investing, property investing, and other things of interest. If you want to be rich then I am going to give you the nonsexy version.
Every day there is some type of hype in articles, ads, etc. about making big money. Hell, Donald Trump has been doing it for years. All those people out there that are asking for your money to learn how to become wealthy are taking you for a ride to get themselves rich. You see getting rich is not really sexy, fast, or exciting. It is and should be boring.
Let me give you a couple of things that I have learned over the years that will help you build your wealth.
1.) The stock market always goes up…in the LONG run! If you want to day trade, you will get killed. You also cannot “beat” the market. What you can do is buy solid stocks and sit on them for as long as possible. I am not talking months…but years, even decades. If you look at the financial chart of the Stock Market from its beginnings you will notice the diagonal line going up, up, and away. BUT, if you narrow it down to any set of years you will see the ups and downs. The key is to ride it as long as possible while it goes up.
2.) A stock is not a loss unless you sell. You hear people talk about taking a beating on some stock…but if you buy a stock at $10 and it goes down to $1…..don’t sell. Hold it. You might not like looking at the loss…but it is not a loss unless you sell, meaning it could go back up. I know people that have owned GE, Apple, Tesla, IBM, etc., and have sold at one time or another thinking they were going to lose everything or would never make more than they already had. But if they would have held on to the stock, it would be an even bigger profit now.
3.) Don’t invest money you don’t have. So many people use margin loans (borrowing to buy stock) in hopes of making the buy price back and more to repay the loan. If you have $10,000 and you can honestly live without it, then put it into stocks or ETF’s. Never use a margin loan or credit card to buy stocks. If you take a loss…you are going to owe more than you borrowed…and owing money is not being wealthy.
4.) Read, read, and read some more. I usually wake up around 5-6 am every day. I make my coffee, grab my Ipad, and open my subscription to Apple News. I follow almost every industry, financials, banking, and even individual companies. I read it all and then the next day I read it again and the next day….yep I read more. You see, the more I read the better idea of a larger picture I build of where industries are going, what politics might sway policies that affect companies, buying, lending, etc. I also follow companies on my Yahoo stock app., too, reading breaking news about company developments, ideas, and product announcements. I build a picture of where things are going. For example, I remember when cloud computing started to be developed. I found it interesting and then saw particular companies offering services and once I felt confident to buy…I jumped on Amazon, Microsoft to start and have built up more with some other companies. They are paying off and I will not sell them unless absolutely necessary.
5.) Don’t spend your money like an idiot. I drive a Toyota with 110,000 miles on it. I don’t wear an expensive watch…hell I don’t wear one at all. My clothes are basic and I laugh when I see people spend $300+ on shoes. I do though spend my money on things that give and hold value. A nice house will return my investment. Stocks will return my investment. A nice vacation with the family…heck yes. That is my personal family experience investment. BUT…I research not overspending on all the things that go along with those purchases. Heck, on some of my best vacations I slept in the back of my truck. The point is, don’t go all gold toilets, Ferrari driving, Rolex wearing people, and use that money to make you more money.
Anyone can become wealthy if you just take your time and let your money work for you.