Understand The Obstacles On Your Path To Wealth
For a lot of people, the idea of having money is an essential requirement to sustain your lifestyle and your family. Consequently, being the provider for the family – or one of the providers – is not only an indispensable function for you to fulfill, but it’s also a source of pride. Being in a position where you can manage your income effectively for your family reflects the values and expectations you grew up with. Indeed, the relationship you develop with money is the result of your childhood and life experience. Hence, most households embrace the idea of money as an indispensable resource you need to use wisely and carefully. Money is precious as it pays for your education, health, heating in winter, and food.
Consequently, one would think that earning more money than you need to sustain your lifestyle and family would be perceived as a positive development. But in reality, the majority of people who become wealthy develop a form of money-related guilt. Sometimes even the thought of becoming wealthy is enough to make you feel guilty. Ultimately, the way you react to your economic success is often determined by your social community and your family background. In families where budgets were kept tightly together, developing a wealth strategy can be painful and distressing as you might feel you are deviating from your family’s values. In reality, guilt is one of the many obstacles that stand in your path to wealth. But with the right guidance, you can work around most obstacles.
Wealth is about provider’s sustainability
Let’s tackle the first obstacle: Wealth guilt. There is no shame in being wealthy. However, to quote Benjamin Franklin ‘Being ashamed of it is [shameful]’. While Franklin referred to poverty, his statement remains valid. It’s the sense of guilt and shame that people carry with them that deserves the attention here. Indeed, wealth is nothing but the result of hard work and the services you provide others. In other words, it appears foolish to be ashamed of earning your money by delivering value to customers. When you realize that your wealth is only the natural extension of your value in the business world, it becomes easier to accept. Additionally, being wealthy also means that you can look after your family and ensure that they have everything they need. Furthermore, from a personal perspective too, wealth is about sustaining your lifestyle – both as an individual and as a provider for your family. As you accumulate wealth, you become more independent and rely less on others.
Your wealth strategy starts with you
There is a significant difference between accepting wealth as a natural manifestation of your worth in the market – the additional value you provider others – and building your wealth strategy. Getting rid of the guilt feeling associated with wealth is one thing. But feeling the confidence to create a strategy about getting rich(er) is a completely different kettle of fish. Indeed, your wealth strategy is disruptive by definition – in the sense that you have to make changes to your everyday routine to make it happen. Disruption, and even positive disruption, doesn’t happen unless you’re confident in yourself. Indeed, making big changes to your day-to-day life doesn’t happen overnight. Harnessing the power of positive psychology, for instance, can help you to gradually shift your mindset from embracing and understanding your emotions about wealth to putting your fate into your own hands. The most important lesson you can learn here is to identify your negative triggers – aka the patterns and events that are negatively associated with money – so that you can adjust your habits accordingly.
Saving is not wealth management
If you’ve been looking on your favorite search engines how to get rich, it’s likely that you’ve stumbled across several articles claiming that you need to maximize your savings. The truth is that you can’t save enough money to generate wealth. On the contrary, the act of saving doesn’t make you rich. In fact, while saving money can make a difference, it’s impossible to save enough to sustain yourself. Admittedly, you can find a purpose for your savings – and that’s precisely what your wealth strategy needs to do. To generate wealth, you need to make your money work for you. Providing for your family, earning a living and working every day are essential elements of a sustainable household. But they don’t constitute wealth per se. From the moment you can give your money purpose, you can ensure that your future self and the future of your family are in good hands. How do you best make sure your savings work for you? You invest.
Profitable investments for beginners
Investments can be scary, especially if you are not an experienced financial guru. For newcomers to the financial world, investing can be synonymous with wasting – especially if you don’t know what you’re doing. But, contrary to popular belief, not all investments need you to be a professional stock exchange trader. You can pick a physical investment strategy – such as property investment – where you own a tangible item. A profitable strategy is to develop a buy-to-let side hustle with holiday rentals in attractive locations. You can find out more about real estate in Singapore – the second most visited city in Asia Pacific –, for instance, where you will be able to rent out your property throughout the year. Other attractive holiday destinations are Malta, the Seychelles, rural Japan and the Mexican Pacific Coast. Holiday rentals in those areas are likely to be fully booked all year long. Additionally, rentals prices are more profitable for holiday destinations than long-term rental properties in towns.
Investment is a matter of risk tolerance
However, the disadvantage of a property investment strategy is that you need to arrange for constant maintenance and management. As a result, more confident investors prefer strategies that don’t require involving asset management fees and duties. Stock exchange investments offer the benefit of a private investment portfolio that doesn’t rely on public use. However, where the property market provides the stability beginners need, stock exchange markets are constantly fluctuating. You can win big one day and lose big the next day. In fact, in this kind of self-focused investment portfolio, you need to be willing to take risks – in other words, to lose sometimes – if you want to win. No pain, no gain, as the saying goes, and this is particularly accurate for a financial investment portfolio. Not everyone is happy about taking risks with money – in fact, you might want to review your risk tolerance before making any decision. Building wealth through financial investments is a game of patience. It’s a profitable solution if you want to ensure future revenue. For short-term or regular gains, property investment remains your best bet.
Wealth doesn’t have to change you
One of the common worries about sudden wealth is that it might affect your behavior significantly. While people such as Bill Gates paint the portrait of charitable and helpful wealthy individuals, a positive attitude to money tends to be the exception if you’re unprepared. A study published in 2012 in the ‘Proceedings of the National Academy of Sciences of the United States of America’ reveals that wealthy individuals tend to engage in unethical activities because they believe they are entitled self-interest maximization. Additionally, money-conscious individuals are more likely to develop a ‘what’s in it for me’ behavior that can stop them from helping others.
The bottom line: Yes, money can change you. But being aware of the dangers of wealth from the very start can help you to become more of a Bill Gates and less of a Scrooge McDuck!
Overcome your fear of money
While you might be aware of some of the most common phobias, such as fear of spiders or fear of height, you might not have heard of Chrometophobia, the fear of money. At its heart, the fear of money refers to the fear of dealing with financial matters, regardless of whether they are positive – aka you’re wealthy – or negative — you’re in debt. This fear can not only cause you increased stress and anxiety, but it can also affect your wealth plan for the future. When the pressure of managing money becomes overwhelming, some people choose not to manage it more than it is necessary to handle everyday expenses. As a result, the potential to achieve greater financial stability is left untapped.
Lack of guidance on how to manage your wealth
The self-help market lacks guidance when it comes to accumulating and maintaining wealth. While you can find plenty of guides encouraging you to save to pay your debts, there is little support to those who are debt-free and unsure of what to do with their money. When you don’t have any obvious financial goal – such as planning for a holiday or early retirement plan – it can be tricky to figure out what good money can do. Maybe the key to finding your path to wealth is to discover your passion, whether you want to see the world or to help your local community.
Building wealth is one of the most controversial activities you can pick. For many, money is a subject of worries that can affect your personality. But with the right mindset and the appropriate goal, you can build sustainable financial stability for your family and still provide value to others.