Newsletters come a dime a dozen. You can delete this one as fast as it comes in but many of you don't. You don't have to read it, forward it or talk about it but you do. I appreciate all the suggestions of articles, books, conferences, stocks, mutual funds, small business investments, etc. I personally look into all of it. I may roam around yachts and private aircraft, but I'm from the country and country people "preciate" stuff cause we know you didn't have to do it. Shouts out to all those who have decided to make your way to the 2014 Ft. Lauderdale Yacht Show with us. Merry Christmas and Happy New Year from The Investment Forum.
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You Want a Pile of Money to Catch a Feeling You've Likey Already Caught
I can guarantee you that you want a pile of money to catch a feeling you've already caught but you want it more consistently, permanently even, which is impossible. So like a fein you chase, trying to catch that high again. Come on give it to me, Big Daddy, so I can finally be free. It sounds so harsh, so direct, but it's true. You don't have to read any further than this paragraph for me to prove it. I know a happy family who earns less than $30K a year, who lives in a home they paid $8K for with two reliable automobiles valued at less than $10K combined. They love their 70 inch screen TV and their multitude of appliances to prepare meals for family and friends who perpetually come to visit. Their day-to-day schedule is generally filled with just sitting around the house watching the time pass. I know another family who earns more money than you can count and have been spending $200K a month for at least fifteen years. They have all the trappings of what we consider wealth with mansions, yachts, private aircraft, complete staffs at all of their residences, exotic cars, charity balls, etc. So which family would you like to be? Let me be brutally honest, I'm closer to family #2. You could answer either way depending on how you want to live. Some people are fighting to become wealthy when they already are, even if not in financial terms. What you should be fighting for is financial security and then financial freedom both of which comes from investments. Wealthy is just a feeling that comes and goes but it never lasts forever.
Check Your Emotions or Pay the Price
Before you pick an investment vehicle, I always advocate itemizing and pricing out exactly what you want long term. Short term is too choppy - a pair of pants today, a coat next week that regardless of the brand they will fade to the back of your closet with a new trend. If you think itemizing a list is not worth your time, trouble will eventually find you. Without a road map of where you're going, a modicum of success will make you think you're an expert that leads to you take a long shot. Let's take a couple who grosses $120k a year. The husband (usually the culprit) decides if we can make $200k, we'd be set, not realizing how far he's actually up the food chain. He remembers that feeling they caught when they went on vacation for a week right after they bought a new car and everything felt so superstar like. They felt wealthy but a lot of time has passed since that feeling and he needs it again. So he takes $1,000 a month from the budget to chase an investment. He doesn't realize he's asking $12k a year to provide him an additional $68k, so he chases everything in a tail spin figuring at some point he'll hit a home run. One day it's stocks, then real estate, then network marketing, then a restaurant, and then and then and then the bill comes from all that he thought was right.
The $200k a month spenders that we mentioned earlier found themselves in a ton of trouble when someone bilked them out of $165,000,000. Yes, you read that correctly. Their goal was simply more of the good life, instead of itemizing and realizing they'd hit the big goals that they wanted to achieve years earlier. The thirst for more created bills the same time his investments plummeted. He forgot that markets can stay down longer than you can stay solvent. When the spending keeps you up late at night, you get weak. When you get weak, vultures notice and prepare a guaranteed investment (no such thing by the way) that will give you the cash infusion you desperately need. Big Daddy returned.
Financial Security Doesn't Have to be Boring
The biggest hurdle to accumulating a lot of money is the simplest. Nobody wants to hear this but you have to spend less than you earn. The trouble is all the stuff that keeps pulling at us. For some it's travel, for others it's a Rolls Royce or something in between. In either case, whether you have $150 left after you sock some away for retirement and your bills or $30,000, if you spend more than what you have I can assure you that road leads to a lot of places and none of them end at a lot of money. I'm not about to lecture anyone about settling for life at the low end of the spectrum. I spend my fair share of time in the cocoons of opulence because these environments keep me motivated. Here is the deal though; I don't have to have them all the time. New money brings the thrill of excitement, but even excitement has a limited lifespan. Trying to spend every day in the lap of luxury will eventually leave you penniless, no matter what your bank account says. You can spend hours at the most exotic locales then go sleep in a much lesser rented bed. At the end of the day, it's all opulence but one way is substantially cheaper than the other.
In order for you to have a more prosperous financial life, you have to invest. If you put $1,000 in a savings account and come back a year later, you've already lost some of that due to inflation. That means your money has to be invested in something that will at least beat inflation.
Uh-Ooh, Here Comes Mrs. Comfortable
How many times have we heard people say they just want to be comfortable? If you don't need the fancy things life has to offer then, your financial security should come a lot easier making you emotionally stronger when it comes to spending money but I bet you it doesn't. Why not? For one, comfortable people aren't financially secure but financially secure people are awfully comfortable. Most simply will never do the work required to even feel comfortable. Add in a few unexpected expenses, Black Friday events or pay cuts and people throw in the towel when it comes to accumulating money, but I say get the towels back out. Formulate a strategy for success and achieve financial security at the very least. Regardless of your pile of cash, 2013 is a wrap my friends. Please keep pursuing the lifestyle you've been dreaming of but keep things in perspective and do it responsibly. We've got 401ks and 529s to fund, homes to pay for and business trips to take. And stay away from Big Daddy. Let's work!
Hanging wth jazz great Sky Johnson and BET Co-founder Sheila Johnson Newman @ Salamander Resort - Middleburg, VA
