Last weekend my wife and I sat down and added up our net worth. We are somewhere between $950,000 and $980,000 depending on how it’s calculated. This is isn’t too bad for a couple in their 30s. When I think about the things we’ve done to get to where we are, a few points come to mind.
1. Learn to invest: A lot of wealthy people get that way by investing. Learning the basics of the stock and real estate markets can really help you get ahead. It also helps you maximize your returns and take advantage of opportunities as they come your way. There are tons of great resources on the web – Kiplinger’s Personal Finance and Investopedia are two excellent free resources.
2. Listen to and associate with successful people: There is a ton of social psychological research on this point but the main idea clear. People who are interested in making money tend to associate with one another and tend to have viewpoints conducive to making money. So if your aim is getting ahead financially, spend time with people who are financially successful.
3. Take calculated risks: It’s very, very hard to attain real wealth (like more than 5 million) if you are investing only in low-risk low return assets. Bonds are great for seniors, but they generally don’t do as well as stocks. Federal debt (t-bills, savings bonds, etc.) are super safe, but their yields after inflation are dismal. The bottom line is that you can’t really do well financially unless you are willing to take calculated risks. The math just doesn’t add up.
4. Put good things into your mind: Millionaires tend to spend a lot of time reading for education. So if you want to get ahead, you probably should read the personal finance canon. Books like The Intelligent Investor, The Millionaire Next Door, Think and Grow Rich and Your Money or Your Life all help expand your mind and will give you a basis for understanding how millionaires think and act. In addition, the wealthy also focus a lot on specific knowledge, so researching specific problems or learning specific skills will help speed you on your way to being wealthy.
Like DINKS? Subscribe!
Subscribe to get the latest DINKS Finance content by email.