Right now, you are making money mistakes that are costing you. It’s not your fault. You don’t know any better. You weren’t taught any better. Actually, in many cases, you were taught wrong. You may have learned some of the basics of managing your finances in school, but they didn’t teach you what you really need to know to OPTIMIZE your wealth. Big difference. And that’s why I’m here.
Let’s pretend that everyone in the world thinks that 1 + 1 = 3.
I know this is crazy, but let’s just pretend. Now pretend that you happen to discover that 1 + 1 actually = 2. How would you respond? Would you keep this important information to yourself? Or, would you feel compelled to share it with the world?
That’s how I feel about the financial education many of us receive today. We think – because we are taught – that 1 + 1 = 3 when it actually equals two. And for some reason, most of the institutions, educators, and financial influencers aren’t bringing this life-changing information forward.
They are keeping it to them selves and in many cases, using it against us.
This leaves you turning to Google or “experts” with hidden agendas to learn how to get the most out of your investments. It results in unnecessary mistakes and valuable time wasted. I’m here to help you get your money on the right track.
Let’s look at a couple examples:
You’re investing in mutual funds and index funds.
Mutual funds and Index Funds, aka “Exchange Traded Funds,” were created to help the general public invest their hard-earned money. If you’re someone who is ignorant to the world of investing and you’re not willing to learn, then mutual funds and exchange traded funds are just fine for you. You’ll probably do as well as everybody else and live an upper middle-class life.
You’ll be mainstream. But, if you want to achieve a higher level of success, you need to be able to think outside the box.
Most of society invests into mutual funds and exchange traded funds because they have hundreds of positions. But mathematically speaking, you only need about 40 – 60 positions in order to be fully diversified from risk. As Warren Buffet has said, “Diversification is protection against ignorance.” So, if you are okay being ignorant, then mutual funds and exchange traded funds are a fine choice. But if you want to be like Buffett, then it’s time to do things differently.
You’re too active.
Did you know that trading is actually hazardous to your wealth?
That’s right. Individual investors tend to get overconfident, turn over a high percentage of their portfolio annually, and it results in a lower return than if they had done nothing. As Benjamin Graham said, “The investor’s chief problem—and even his worst enemy—is likely to be himself.”
You can’t get out of your way and that’s because you’re too emotionally invested in your decisions. It makes sense. It’s your money – your livelihood – after all. This is why it’s important to know and trust a financial expert who has YOUR best interest at heart, not their own. They can help you manage your emotions and keep your eye on the long game, especially when things aren’t going your way.
You want the American dream.
People love to invest in real estate over the stock market. Real estate, after all, feels more real. You can touch, feel, and walk inside a home. A stock on the other hand, is nothing more than a number on your phone or computer screen.
Most Americans buy a home because we are conditioned to think that renting is just throwing money out the window.
Owning a home is part of the American dream. Well, let’s look at the facts – owning a home also comes with paying insurance, property taxes, repairs, lawn maintenance, possibly HOA fees, utilities etc. Whereas owning a stock costs you nothing. You only pay taxes if you sell on the investment (excluding dividends) and a stock will never need repairs or a new roof.
You are over-insured.
Whole life insurance may have made sense for your grandparents and parents, but that doesn’t mean it makes sense for you. Times have changed. We are healthier and living longer these days.
Investing in whole life insurance can be nothing more than a sure way to limit the amount of wealth you’re building.
On the flipside, if you’re able to achieve massive wealth (over $11 million), then investing into types of insurance is a way for you to avoid estate tax. But for most young people, committing to a lifetime of monthly payments into an insurance product probably doesn’t make sense. If you have children, or plan to have children, term-insurance may be the best way to give you peace of mind.
The point is that your situation is unique. What is best for others isn’t necessarily best for you. Insurance products are set up so that the odds are highly in favor of the insurance company. This is not a situation where you want to make the mainstream decision.
You’re doing it on your own.
The good news is that not all financial experts have ulterior motives. This is where I come in. My personal mission is to show you that 1 + 1 = 2. I will show you the money mistakes you don’t know you’re making so you can take the first important step towards financial freedom.
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