An old article from The Independent newspaper popped up on my Facebook timeline last week, it was entitled, “The easiest way to become a millionaire by the age of 65”. I’d seen it before, quite a while ago, so I thought I’d just take a cursory glance at it, thinking it was probably very dated. However, as I started to re-read it, I realized why articles like this one are so problematic.
Headlines like the one preceding this article this tend to over generalise a very strategic objective and desired outcome; they ignore the importance of mindset. To become a millionaire, you need to think and act like a millionaire now and think in terms of achieving your goals as soon as possible. There’s not much point in gazing into a crystal ball and hoping to achieve your objective by the time you may be too old to enjoy it. You need to think of all the ways in which you can change the way you use and save your money now.
Here’s a great example of small savings that could add up significantly. Think how much money you could save by not drinking a mocha latté at your favourite coffee shop on a daily basis. If the coffee costs you £3.00, multiply this by five (days a week) and then again by 47 (weeks, taking into account five weeks’ of annual leave per year). This amount, totalling £705, could be put to better use, perhaps some sort of self-development or training. For example, you could learn from a professional property investor how to generate passive income stream through creative financing, which would give you significantly more return on your investment than all that caffeine!
With interest rates at spectacularly low rates in the aftermath of the Brexit vote, saving money is probably not the advice a savvy investor would give you. Nor would they necessarily advise you to put all your money into the stock market in the long term, or invest it all in your pension. We have seen the high-risk downside of both these investment strategies in recent times.
What is crucial, regardless of where or how you invest, is to ensure that your mindset is geared up for success. You need to surround yourself with the right people because, as I always say, “Your net worth is your network.” You need to educate yourself and understand how other millionaires and billionaires have achieved their success. You need to rid yourself of the “red-lighters,” people who are always saying, “You can’t do that,” and who hinder your dreams and progress. You need to write a strategy and stick to it.
If you are currently aged 25 and are committed to becoming a millionaire by the age of 35, there is nothing to stop you… as long as you build your strategy around this time frame. I made a pledge to myself when I was 19 and working in my parents’ Chinese takeaway that I would be a millionaire by the time I was 30. I made a strategy, stuck to it, and achieved my goal by the time I was 27. As the famous saying goes, “If you fail to plan, you plan to fail.”
So my advice to those of you who have a big dream but don’t know where to start is: educate yourself. Let articles like the one I mentioned above inspire you, but don’t leave it at that. Learn all you can about the best investment strategies, and make a plan and stick to it. Whilst not every strategy will make you money, the lessons you learn along the way will surely save you money in the long run. One of these might include making your coffee at home and investing what you save on those lattes in yourself!
Wealth Dragons Group Plc
Linford Wood Business Centre