I am not, unfortunately. However my uncle is and I get a lot of sound bites and pearly financial words of wisdom from him now and then. The other day he gave me article to read that sums up most of his pearly words of wisdom. I extracted some to share with you guys. It goes..
Your past equals your present but it doesn't determine your future. (I know it sounded very karma and zenny.) The hardest but the most powerful thing you can do right now is to take total responsibility for your own financial situation. You created it, and you can change it.
The truth is that it's almost impossible to get rich in the share market in anything less than a decade. Yet those investment magazines, gurus, stock tip sheets goad your greed glands with tall tales of stocks that are set to make you rich. It's nothing more than financial porn, designed to sell newsletters or investment services, not make you wealthy.
The reality is that the greatest investor Warren Buffet has achieved a compound return of 19.8% over his investment career by investing in large profitable business like Coca-cola, Gillette etc.. His favorite holding period for these stocks is 'forever'.
So, you need to be realistic about the returns you can achieve. If you invest in strong stable businesses that have a history of paying growing dividends, you can reasonably expect a 10% return, which means your money will double every seven years. Now how much can put aside for investment?
With your earning potential limited by your willingness to earn more money, the difference between what you earn and what you spend will be the biggest factor in how wealthy you become. We always say the more you earn the more you spend. Not necessarily and it's for you to figure out how.
So the advice - take total responsibility for your situation and set about changing it today if you think you don't have enough set for the future or even retirement. Good Luck!
Extract from Herald Sun, 15.6.2012 by Scott Pape
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