“Everything we would ever need to become rich and powerful and sophisticated is within our reach. The major reason that so few take advantage of all that we have is simply, neglect. ” -Jim Rohn
The better question might be how not to create long term wealth. There are number of great opportunities out there for investors, new and old, to create and continue to build wealth well into their retirements.
There are several factors which seem to make investors veer from the path and find themselves not creating wealth but creating debt. Below are several common mistakes and a few great guidelines to follow as you beginning your investing adventure into creating long term wealth.
Know Why – It is important to know why you are investing. If you do not have goal how can you ever reach it? Once your know your reason, ask yourself “is your current technique working?, is it safe?, and can I increase my profit?”
Start Small – Most people jump head first into trying to create long term wealth. People will literally mortgage their house, to have large capital to buy stocks with. Most people do not realize that for $1000 dollars you can create long term wealth. There is no need to sell a kidney or take money out of the kid's college fun.
With a $1000 dollars you can invest in low price stock. If you invest twice a year for even a short amount of time, you are already on your way to creating long term wealth. Each time you invest your rate of return will be double. In 5 years, with the right investments, you are going to near a million dollars in net worth. If you can only afford to invest once a year, that is all right, you will have to wait nine year to become a millionaire.
Avoid Stock Obsession – Your investment portfolio does not have to be monitored all day everyday. Once a established, a check up a couple of times a month is just fine. Obsessing over stocks is just a waste of time, go out and have yourself drink!
No Gambling – If you do not know why you are buying, what you are buying, or how you are buying – then don't. Unless you have some pretty solid research, you have no business gambling your hard earned money away on stocks you know nothing about. Remember the goal of investing is to build long term wealth not debt.
Building long term wealth is not hard but you have to stay on path and not get lazy. While it is fine to seek out advice from family and friends to not substitute their judgment for your own. It is your money. It is your choice, and it is your responsibility to secure your future wealth.
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