This is the same belief I have, which applies to everything in life. Basically, the philosophy is
- to be successful at anything, one needs to do his/her homework to learn it first. No pain, no gain.
- work smart and work hard, rather than just hard work
To grow one's financial asset, I believe the following 3 things are critical
- understand the basics of financial world, which is why you are reading this now. Hopefully, by learning everything from this website, it gives you a solid fundation to start your life long learning on this topic;
- build your first bucket of gold and your fundation. For most people (unless you inherit a large amount of money), it means your job that pays the salary;
- and then use money to make more money
Your goal is item 3) above. However, in order to achieve item 3), one need to do 1) and 2) first and continously. In following Chapters, you will learn more about all above. But first, Let's first discuss the mindset of 3).
The mindset I would like you to change to is that it is must but not enough to just work hard. In the old days, it was usually said that, if you work hard, you will be successful. That's not enough in current world anymore. You see many hard working people making $10 / hour or $80 / hour, but never get ahead in their life.
The key is, instead of just using your time to make money, to use your existing money to make money. You only have 24 hours a day, and there is only so much money you can make per hour (top 10 laywers in the world makes $1000 per hour, but even that's limited). Instead, your money never sleeps and there is no limit of your money. So, you get to use your money to make more money for you.
The basic way of using your money to make money is
- investment : for example, stock, bond, life insurance, etc
- build your own company, so your money (and better yet, somebody else's money, for example, loan from bank or VC investment) will obtain resource (human resource such as employee and material resource such as equipment) to make more money
You may think that you are not up to it. You should be, but the key is to have the right mindset and start young. You can make more risk when you are young (less family responsibility such as kids to think about) and there is more time to recover your mistake.
And, you do not have to be smart enough to know how to do it. The key is that you have to be smart enough to find the right people to do it for you. That's why you need to learn all the things you are learning on this website, so you know how to judge people correctly. And that's why you have to have your first bucket of gold, so the right people you found is willing to help you.
Now, let's make the first step and start happy learning.
