Today, I’ll share the 5 “things” that are MORE RISKY than investing!
Would you agree that many people think that investing is risky?
These folks avoid investing using all kinds of reasons (a.k.a. excuses)…because of the fear of losing money.
Can you relate?
I lost money in some of my investments…And not just few thousands but hundreds of thousands (ironically, when I invested with my financial advisors!)
So, I know that fear of investing can be paralyzing and demoralizing.
However, investing strategically, especially investing in assets that generate cash flow, is the sure way to reach Financial Freedom.
Because that’s how you make your money work for you, instead of you exchanging your time for money!
So, rather than avoiding investing because of the fear, I invite you to reprogram your limiting beliefs about yourself and investing, educate yourself, and learn how to take control over your finances.
Because leaving your financial future to chance is riskier than investing!
Here’re 5 things that came to mind when I asked myself this question:
Your money must work for you. That’s its role. Not to sit on the bank account, or in your safe deposit box, or “under the “proverbial mattress”.
You’ve got to “send your money” to work for you.
Investing in quality assets that consistently puts money in your pocket is a necessary step in your pursuit of financial independence.
The sad truth is that over 95% of people are financially insecure, because they think their money will somehow manage itself and last through retirement.
Yet the reality is that over 75% of people run out of money within the first five years after retirement.
And about 5% who are Financially Free enjoy the freedom and choices in their life because they figured out how to make their money work for them and so, they receive consistent cash flow.
There is NO guarantees when it comes to investing.
But that should not stop you because there are ways to manage the investing risk!
And one of the risk management techniques is diversification – Investing in different types of assets and opportunities because it limits the negative effect of potential loss on your entire investment portfolio. So, protect yourself by diversifying your investments.
And diversification principle applies not only to various assets but also to styles of investments like Income investments and/or Growth investments.
When you purchase assets that don’t generate Cash Flow but have a great growth potential (e.g., Google or Amazon stocks), you’ve got to make sure that you also have income-producing investments, so that you will have consistent cash flow to pay for your lifestyle as well as increase your financial net worth.
ALL financial markets go through ups and downs. It’s the nature of financial markets.
So, those who invest in a short-term, to grab quick profits, often experience lots of stress and sleepless nights.
Short-term investors often get “priced out” of the markets during markets’ corrections… because they panic and sell.
However, long-term, strategic investors get rewarded for their patience and strategic approach, and often buy new assets during market correction.
Investing in the long-term is another risk management techniques besides diversification.
You’ve got to create a Pay Yourself First [saving] account, contribute to this account consistently (for example, automate your monthly contribution to it) and add extra income whenever you can.
However, this money should not just sit idle in your bank account. Always look for opportunities to invest your savings (outside of your “peace of mind” (a.k.a. emergency) saving account.
The sooner you get your money working for you, the faster you’ll reach your financial freedom!
When you outsource any task to others without knowing what they will do, without the knowledge to discern whether their choices are good or bad for your investment, without a criteria for the results you want to accomplish, you are bound to be disappointed.
Yet this is exactly what many busy professionals and entrepreneurs do – they outsource managing their money to financial professionals hoping that they will do the “right thing.”
And many do…there’re a lot of honest people among financial advisers and financial planners.
Unfortunately, there’re also crooks, manipulators, and ignorant advisers, who are smooth sales people and want to sell you financial products and services that are lucrative for them. I learned this lesson a few times.
So, even if you want to outsource managing your money to financial professionals, the wise thing is to be educated enough to ask important questions and say NO to investments that you don’t want or need.
That is the only lever you have to control your money when you outsource it to financial advisers.
If your goal is to stop exchanging your time for money, and enjoy more freedom and more choices in your life, investing strategically is the path you’ve got to follow to reach Financial Independence.
Start by paying yourself first, invest your savings in various income-producing and high-growth-potential assets, so that your money works for you.
To your Health, Wealth and Freedom! ?
P.S. If you want to participate in my upcoming free trainings, make sure you apply to join the Wealth Building For Powerful Women FB group ASAP, where the new trainings will take place.
Millen is a Wealth architect and Financial Independence Coach, entrepreneur, and a bestselling author. Being a Possibilities' Catalyst, she uses her intuition, business, and investment expertise to support entrepreneurial women (like you) who want to master their money, live their purpose achieve financial prosperity and freedom. With her physics and business education, corporate and entrepreneurial experience, money management know-how, mindfulness practices and transformational coaching skills, Millen has a unique ability to guide and support clients in achieving extraordinary success in their lives.