The wealthiest people's primary worries have nothing to do with money. Pixabay
1. The Nature of “Risk”
Most laypeople associate risk negatively. From a young age, we are taught to steer clear of risk at all costs. We try to reduce its impact on our life as much as we can by purchasing insurance, avoiding "risky" employment and investments, etc. Even in our personal life, we strive to minimise danger. Because of what can occur next, we avoid asking the dangerous question, saying the risky thing, and speaking out.
Finance professionals recognise that RISK = REWARD. Without the willingness to give something up, you cannot gain anything.
The New Testament has the phrase, "Whoever will preserve his life, shall forfeit it." Whether you agree with the passage's context or not, the wisdom is still present. The status quo won't change if you cling to it so tenaciously that you are unwilling to see it alter! To get something better, you must be willing to lose the current situation.
Try being more adventurous in your relationships, investments, and work. Naturally, the definition of risk is an unknown result. Each choice could or might not be profitable. But in the end, the person you want to be is the one who takes calculated chances in life.
2. Low Fees Does Not Equal Low Cost
I recently had a meeting with someone who was quite affluent. We were all debating whether to contract the work out to a third party or hire an expensive but knowledgeable staff. The third party was far less expensive than the possible employee, but possibly did not have as much experience or care about our welfare.
"Low fees do not mean low cost," was his sole argument.
Over time, poor choices, errors, and planning can result in costs that are higher than paying to get something done correctly from the start. This doesn't imply spending more cash just to spend it; rather, his point emphasises the significance of getting value for your money.
3. The Only Personal Financial Advice I’ve Ever Gotten From Really Wealthy People
The fact that the world is flexible makes the highly affluent quite different from the rest of us. You can genuinely alter the world if you put enough effort, time, and money into it.
This also refers to how you personally are doing. It can be altered; it is not a given. You might need to be resourceful, conduct a tonne of research, or put in a lot of work, but you can significantly alter your situation.
Stop considering your issue to be fixed. You can make it as big or as small as you like.
4. Money Is Not the Main Concern
It's interesting to note that the wealthy's top worries have nothing to do with money. Everything that is positive and negative about you enlarges due to the magnifying effect of money.
In the end, money is a fickle thing. Wealth is not only about money. Develop your bonds with your loved ones and friends.
5. You Can Be President…IF…
Every kindergartener learns that anyone may become the president of the United States. If you want to, you can become an astronaut. You could...
What they fail to educate you is that if you are prepared to make the required sacrifices, you can indeed become anything you choose. You owe nothing to the rest of the world. You must be willing to sacrifice something in order to get what you want. No longer is that taught...
6. How Markets Work
We are in the heyday of investment. You can achieve everything you can dream of. That decision is tyrannical. Furthermore, research consistently demonstrates that individual investors are terrible at handling their finances.
When you go to engage in markets, having a basic grasp of what markets are and how they operate may really help you feel more at ease. You'll also get a good helping of scepticism from it.
Public markets were created primarily to steal money from the general populace. That doesn't mean you can't make money off of them; it just means you need to exercise extreme caution.
7. Cash is NOT “Safe”
I can't tell you how many inquiries I've had from people worried about making financial decisions. I continually hear, "Cash is safe."
Cash is safe, in a sense. You must realise, though, that you ARE taking a risk regardless of what. Your money loses around 2.7% annually. Accordingly, your $100,000 in cash will be worth $99,775 the following month and $99,550 the following month.
See what I mean? Your money is secure in the sense that it is predictable, so yes. But don't be deceived; its worth is diminishing. Although cash has a function, it is not to protect your riches.
8. You Need to Know the Truth About Gold
Let's be honest about gold's place in a portfolio. It can, in fact, be included in a larger allotment. However, gold is NOT a substitute for a balanced investment portfolio.
The CNBC ads are really skilled at making gold sound like the solution. especially in times of emergency. "The only REAL money is here," I've heard everything.
The harsh reality regarding gold is as follows:
- Since 1981, gold has lost value in relation to inflation. Contrary to what advocates of gold will have you believe, gold is a lousy long-term inflation hedge.
- Stocks are 3 times less volatile than gold. Gold is not the solution for those who are avoiding the stock market because it is too volatile. More of a roller coaster than the stock market, actually!
- In a failing economy, everything counts. Please see my rant below.