A good investor “turns over a lot of rocks” in search of something special and profitable.
Every person who strives to gain financial wealth and monetary well-being should do the same.
Otherwise, he will never say goodbye to his eternally empty wallet and loans at extortionate interest rates.
Why is it so difficult to become rich?
4 Laws of Monetary Success:
1) Calm times sow “seeds of madness”
That is why we should not relax in “easy” times.
Because the economy develops in cycles — the rise (growth) of the economy is inevitably replaced by recessions and severe crises.
Quiet times play a cruel joke on us:
* When the economy is stable, people become overly optimistic.
* And when they become optimistic, they blithely accumulate a bunch of loans.
* And when the population and enterprises are over-leveraged, the economy becomes fragile and unstable — and plummets downward for any, sometimes the most insignificant, reason.
WHAT TO DO: In your family finances, never turn off the “Fasten your seat belt” signal. What does it mean to prudently have a “financial cushion” and a couple of “backup airfields” in case of a sudden loss of the main source of income.
2) Money forces us to be extremely emotional (reckless)
Because the well-being of our family depends on them, incl. our secure old age.
After all, no one wants to collect empty bottles in the trash in order to somehow feed themselves in retirement (the size of which often leaves much to be desired).
SOLUTION: Learn to “turn off” emotions when solving financial problems. The first step is to start saving part of your salary (this will give you a nest egg).
The second step is to invest 10-20% of each income received monthly (by buying currencies, index funds and other assets).
3) Speculation will ruin you, but investing will make you rich.
Let me give you this example for clarity: Microsoft shares are bought by pension funds, index mutual funds, day traders (high frequency speculators) and trust managers.
However, they all have their own objectives — which vary dramatically depending on the investment strategy they employ.
WHAT TO DO: Focus on information that aligns with your financial goals.
This rule is crucial when investing your money.
However, this will be much more difficult to do than you think (due to the extremely contradictory information and news noise that constantly surrounds us in the financial markets).
Don’t let them lead you into temptation.
4) Learn to manage risks
Most external events are beyond our control, so we are powerless to change or correct them.
But we can prepare for them in advance in order to neutralize their negative consequences (which can instantly crush all our plans for a bright future).
Let me remind you of the wonderful words:
“Success is a bad teacher. He makes smart people think they can’t lose.”