5 Tips for Investing Like the Super Rich
Every investor dreams about the day of the big payoff, when the years of conservative building and high risk gambles lead to true wealth. But studies have shown that the super rich and the common investor don’t often approach things the same way. Well, if you aspire to someday be rich and wealthy beyond your wildest imaginings, you should follow the lead of those who already are. So in the spirit of wealth-building and financial freedom, here’s five tips for how you can invest like the super rich, and someday join their ranks.
Don’t forget your emergency fund. Every wise investor keeps a bit of cash on the side, but the super rich investor keeps a lot more. You should always have a highly liquid emergency fund available, where you can instantly access a solid cash savings. Though this cash kept aside will likely not earn you much of a return, the fact that it is available to you in a pinch will have you sleeping much sounder at night.
Forget the headlines. With the 24-hour news cycle an investor’s constant companion, it’s all too easy to get caught up in the noise. TV, radio, and the internet offer a rainbow of financial pundits, none of whom can be completely trusted. After all, their primary focus is ratings, not the continued health of your portfolio. Sound-bite reporting, with a lot of noise and not enough facts, can be misleading far more often than it is helpful. So take it all with a huge heaping of salt.
Fear is your friend. It’s easy to buy when the markets are rosy and every financial voice has a host of can’t-miss suggestions. It can be terrifying to invest when the market is in turmoil, and the pundits are in a panic. But that’s when you can make the most money. These are generally opportunities for a major haul, and they don’t come around all that often. If you can keep your head and buy successfully in a bear market, you’ll find yourself much closer to the world of the super rich.
Mistakes are part of the journey. Even a financial genius isn’t right every single time. You will misstep. You could end up regretting a buy, or regret passing on one. ‘Safe moves’ could stumble, and the market could turn on you. With your emergency fund, you’ll easily be able to extricate yourself from these situations. And if you can acknowledge the mistake and learn from it, you’ll have much more success in the long run.
Love what you’ve got. Money isn’t the goal by itself, or no one would be inspired enough to set their lives towards accruing it. Money leads to things that enrich your life, and you have to enjoy the steps along the way. Some who try for wealth can become bitter when faced with other’s successes, or thumb their noses at the poor. But this attitude will not help you get where you want to go, and could in fact deter you. Count your blessings, and make sure you love what you’re doing. Whether your passion is investment bonds, equities or stocks, appreciating where your portfolio stands right now will keep your work from ever feeling like work.