We have developed a dual attitude towards investments — we are afraid of them, but we cannot do without them.
If all your attempts to “make money on investments” have ended unsuccessfully, then read below the 5 principles of increasing money.
Now is the time to correct your past mistakes and start over. More confident, with greater reliability, without stress and losses.
1) The only person keeping you from making a profit in your investments is yourself.
The secret to creating great wealth is relatively simple:
“Spend less money than you earn and invest the rest.”
In practice, it looks like this: every month, allocate a part (optionally, 10-20%) of your salary to purchasing assets.
And enjoy the “eighth wonder of the world” known as the “compound interest effect.”
It doesn’t matter how much you invest monthly.
What matters is the sequence of actions and a long investment horizon (10+ years).
2) Stay cool when the stock market is down and the economy is going crazy.
A good investor does not allow his emotions to interfere with the growth of his investments.
Understanding that you own real assets (share in a business, rental real estate, index funds, etc.) helps you do this.
This combination of assets of different classes in our investment portfolio protects the money we invest from severe drawdowns.
There will always be an asset in the portfolio that will “stay afloat” when others go down under the weight of bad news.
3) Real estate is not a panacea
Misunderstanding of the previous point leads to a typical mistake common to many beginners.
They keep all their money in square footage alone, falsely claiming that “real estate is the best investment.”
Let me explain:
Real estate moves in spurts — its value grows extremely unevenly.
A sharp increase in the price per square meter is followed by a long period of stagnation or even decline.
4) How to identify a good financial advisor (and not fall for the advice of a bad one)
First, a good advisor will not try to sell you endowment life insurance (or any investment products related to life insurance).
Due to the fact that there are too high hidden commissions and huge fines for refusing the annual contribution under the insurance contract.
Secondly, it does not offer you active investment management (including asset management, industry and niche investment strategies).
Because of their increased risk compared to long-term portfolio investing (using index funds).
Third, it doesn’t offer you insight into the future behavior of financial markets.
Because “no one knows the future” and no mathematical models allow us to predict future events with high reliability.
If your financial consultant “sins” with such signs, then this indicates that he is a seller (receiving a commission for attracting clients’ money), and that he has a clear lack of knowledge about the correct principles of increasing money.