Four Tips For Building Wealth
Our wealthiest clients have a lot in common when it comes to their investment history. They didn’t become wealthy by accident or coincidence, they did it through hard work, discipline, and starting early. Here are four of the things all of our wealthiest clients did while building building their wealth that anyone can imitate:
1) They built their wealth slowly and methodically. This isn’t rocket science—they spent less than they made and invested the rest in global stock markets.
2) They did not adhere to the “buy and hold” method—they chose the “buy and buy” method. These families were steady accumulators, buying stocks when they were up and when they were down. They never attempted to time the market and paid little attention to their monthly statements.
3) The most successful of these families had an investment adviser that bought the cheapest asset classes in new purchases and had the discipline to keep buying when markets were doing terribly (1974, 2000 and 2008 in particular). These bear markets were not a bad time for these families, as they bought cheap stocks hand over fist and saw it as a great opportunity to build long-term wealth even more quickly.
4) None of them jumped in and out of the markets “at just the right times.” In fact, many people we come across who are way under-saved are in that position because of market-timing attempts gone wrong.
If you consider these four commonalities among our wealthiest clients, one thing becomes clear—if you want to become wealthy, a sure way to do it is to be patient.
Spend less than you make, and invest the extra in global equities. Never try to time the market. As you keep buying and buying, tilt your new investments toward large asset classes that are doing poorly—they will be relatively cheap (on sale)! You many need the help of an investment adviser to do this.