This Is How It All Starts

By the time I get to be forty years old I don’t want to ever have to utter the phrase “I can’t afford that”. In fact, I would like to retire around that age. I’m not unrealistic about this however. I think that private islands, personal jets, and yachts that qualify as cruise ships will forever be out my grasp. Not that I consider that to be a bad thing. I don’t see how you can have a normal life with normal friends when you’re worth billions of dollars. I can’t help but think that that would just suck.

I don’t want to be a billionaire. I’m pretty sure that people with retarded amounts of money like that really lose their grip on reality. Warren Buffet might be an exception. But, I wouldn’t mind being a millionaire. That way you have enough money to have comfort and security and provide your family with a lifestyle that has them wanting for nothing. I want money but not “fuck you money”. I still need to keep myself grounded.

Since very few people are lucky enough to have a seven figure salary, I guess I will have to take matters into my own hands. I’m of course talking about having a strong and wise investment strategy. There is in fact nothing that I think is more important than this. To rely solely on your salary to support yourself is a short-sighted thing to do.

I’m surprised that not more people do this. A lot of people I know are afraid to take a portion of their hard earned income and place it in the markets. They cite market volatility as the biggest reason. The most common response I get is that it is just too risky. Of course it’s risky. The trick is to find an appropriate way to manage that risk. The best way to do this is to view risk as a necessary part of earning a return. No risk no reward.

Getting started is the hardest and scariest part. I myself haven’t even taken that all too crucial first step. Not because I’m sacred but because I’m starting out with nothing. I’m sure we’ve all heard the phrase “you have to spend money to make money”. The thing is, in order to spend that money to make money you have to have some in the first place. That’s what I’m working on right now. To be clear, I’m not just waiting around doing nothing while I save a little cash. I am doing research on how to invest and how to develop an investment strategy. I’ll get into that later.

My thoughts and feelings towards this are built upon a few nuggets of knowledge and wisdom that I have picked up over the years.

• You can accumulate wealth no matter your level of income. Unless you are living beyond your means you should have at least some money left over in your budget. Or, even better, you should have a line item in your budget for savings/investment. It is important to not let this surplus just sit on the sidelines. Make it work for you. This actually leads into my next point.
• Cash, just like milk, will go sour if you just leave it lying around. If you put your savings into an ordinary savings account then all you are doing is slowly rendering your money worthless. The interest you’ll earn on a savings account will not even match inflation. Year after year your money will lose its value unless you make it grow.
• If you want to make money you will. If you can make one dollar you can make a million dollars. With all of the investments you can make that are readily available to you making money is easy. You don’t even have to work all that hard. All you have to do is be willing to go out and get it. That being said, the pursuit of money can be corrupting. If you set out to make retarded amounts of money then you will. But, it will probably come at the cost of friends, family, and happiness. A 5000 square foot mansion is pretty awful if you’re the only one living in it.

In addition to being realistic, I find those three maxims to be highly motivational. I don’t think the complexities of anything can be boiled down to such simple phrases, but once you have a broad understanding of any topic these devices can be quite effective. When I revisit these three points, and all the others I have, I feel that I can conquer the world. One step at a time, of course.

I of course know a lot more than that but I need to save a few things for future entries. Starting an investment portfolio is something that is very important to me and something I will devote a large part of my time to. I will probably write about it a lot. However, I need to make something clear. I will never discuss the specifics of my investment strategy nor will I ever give out investment advice. Your financial security is not a responsibility I want.