The one thing nobody tells you about being rich
Let’s be frank, from a young age we pretty much all walk around dreaming of being wealthy.
Of having enough money to be able to do whatever we want.
No-one ever really dreams of being poor.
We all have aspirations, and at some point in time (hopefully) we start working toward them.
But there’s something that nobody ever tells you about the reality of having money. I’m not talking about a few thousand dollars. I’m talking about what it feels like when you have an asset pool (whether it’s cash, shares, property or likely a combination of all three) that took you substantial time and effort to build.
Ironically, it’s the exact opposite of what you expect to happen.
When we’re still dreaming of wealth, we associate it with being free and having no worries. We imagine what it would be like to buy whatever we want, do whatever we want, be wherever we want, without a second thought. However… in reality, we often end up more stressed, anxious and worried. About what you ask?
Having wealth often results in us being in a permanent state of fear of losing our money.
No one tells you this. No one ever talks about what it feels like to be afraid of what to invest in, or what to do with the money that you have. Nobody tells you what it’s like to live in fear that you’ll make a big mistake and lose it all.
First world problem, maybe. (At least you have money, blah blah blah…)
However, it is a genuine problem that can be worrying at a best and paralysing at worst.
The fear of losing money often causes inaction (paralysis by analysis), or irrational decision making (like selling all investments when the market inevitably drops). Ultimately it’s this fear that will hold you back and stunt your financial potential if you don’t take action to overcome it.
How to overcome the fear
Read and learn about investment markets. Get comfortable with the fact that although investment markets will go up and down, but if you look back on any invest graph over a long term period they trend upwards.
Talk about it.
If you have an advisor, let them know your worries so they can address them, remind you of the bigger picture and help put your mind at ease. If you’re in a relationship, talk with your partner about it too. Often just airing your concerns helps you to put things back in perspective.
Set goals and boundaries.
Knowing what you’re working toward, and how your investments are being used to achieve those goals will help you stay focused on the long-term perspective.
Stop looking at it.
As tempting as it can be to look at the value of your share portfolio every moment, you’re wasting your time.
It only matters what the value of your portfolio is when you want to use the money for something. In reality, you’ll probably one day be using the income rather than selling the shares. It’s the income that matters anyway not the value of the portfolio.
If you’re sitting on a pile of cash (maybe you’re a good saver, sold a company, or even received an inheritance) you need to do something with it.
You’re probably doing nothing because you don’t know what to do. You don’t want to see your position reduced, however staying in cash is what we refer to as ‘going broke safely‘.
Your capital will never increase, and with RBA interest rates currently at 1.75% you’re not even keeping up with inflation.
If schooling up on investing is appealing to you, or if you just wouldn’t mind a refresher, register for our upcoming webinar: Investing for Millennials (there’s no cost, and will run for just 30 mins). Our Chief Investment Officer, Finn Kelly, will take you through the ins and outs of investing for millennials, the various types of investments, how they work and what to expect as a millennial investor.
Ready to become your very best? Get started with a FREE Strategy Session today.
Disclaimer: all information contained within this article is of a general nature. It should not be relied upon when making financial decisions. Please consult a professional financial advisor or planner (like us!) before acting.