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The 1st step in becoming wealthy is...

Discussion in 'Investor Psychology' started by Ace in the Hole, 25th May, 2016.

  1. Ace in the Hole

    Ace in the Hole Well-Known Member Premium Member

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    Stolen from an email I got today, and couldn't agree more:

    The 1st step in becoming wealthy is VERY simple…
    but sometimes the simplest things can be the hardest
    to do. So here it is…

    YOU MUST INCREASE YOUR INCOME!

    Look, the reality is, you can’t get to $1,000,000 without
    going through $100,000. So… how could you pick up an extra
    10% in your income at your current job? How could you make
    an extra $500 a week… or how about an extra $1000/mo???

    Could you ask for more hours?

    Work on an extra project?

    Bring new business to the company?

    In my company, employees in every department have the
    ability to earn bonuses for bringing leads to the sales team.

    No matter what your role in your company, I guarantee that
    there are things that you can do to increase your income
    this month… JUST ASK

    Be honest, is there more income potential where you are at
    now than you are taking advantage of?? Come on MAAAAN!!

    You can make money or you can make excuses, YOU CAN’T
    DO BOTH!

    It could be that you simply need a few extra tools in your toolbox.
    Check out what some of the pros are using to increase their income
    here

    So… you got it? First step to creating wealth… Do whatever
    it takes to increase your income!!!


    We are now earning more than 10x what we were just over 10 years ago.
    I can tell you that investing is much easier now and the options and opportunities are much greater.
    The thing is, we are working no harder now than we were back then, although the skills are there to produce results when required.
    I think the key is to focus more on investing in yourself when building the foundations rather than focus too much on the investments themselves, over analysing, etc.
    Got to walk before you can run.
     
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  2. Leo2413

    Leo2413 Well-Known Member Premium Member

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    I'm curious before you decided to increase your income and grow wealth, what changed in your mind? What shift did you have in thinking?

    Because I don't think anyone wakes up one day and says I need more income in order to have more options to then leverage my resources to build wealth. Something must have happened before all that.
     
  3. Xenia

    Xenia Adelaide Property Manager Business Member

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    You develop a mindset of focus on what is important, lose the fear of adding additional streams of income and trust more in yourself rather than other people's opinions.

    I agree, add more income - love it Ace.

    Before you increase your income, you need to become the person who is capable of increase their income. You earn what you think you are worth.
     
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  4. Bayview

    Bayview Well-Known Member

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    The first step in becoming wealthy is to be good at managing your money - to spend less than you earn.

    The second step is to save what you don't spend (not Bank accounts); to be used towards investments that will increase the savings/income.

    EDIT: Bank accounts are only good for parking money until you can find a better use for it; otherwise useless as an investment generally.
     
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  5. Jerry O

    Jerry O Well-Known Member Premium Member

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    Adding Bayview's comments to the OP would be the way to go IMHO.
    Spend less than you earn and find ways to increase your income. Then keep investing.
    One of the key requirements asked in getting an investment loan is do you have the capacity to repay the loan. So this is inline with Ace's comments that as their income increased, the capacity to invest becomes easier as well.
     
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  6. Ace in the Hole

    Ace in the Hole Well-Known Member Premium Member

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    I'd been doing all the self improvement stuff since I finished high school, but nothing significant ever really resulted until much later on, like over 10 years later.
    When I started in property, I wanted to go hard and fast, like most eager beginners with dollars in their eyes.
    This was at the end of the Sydney boom in 2003 and I'd only ever seen prices going up since I started paying attention.
    As most do, got stuck very quickly on low income and was always feeling disadvantaged by this compared to others on high incomes.
    Simply made a decision at that point that I had to increase income to make investing easier, rather than being a slave to my investments.

    Seems that many people take the approach of being a slave to their investments because their incomes limit their choices, but the lure of faster financial freedom locks them into a corner.
    It don't have to be that way.
     
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  7. pinewood

    pinewood Well-Known Member

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    @Ace in the Hole , would love to hear how you did it....care to elaborate on what approach you took to increase your income?
     
  8. Ace in the Hole

    Ace in the Hole Well-Known Member Premium Member

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    Sure.
    Just started importing stuff from China and started selling on eBay.
    Still running the same biz now importing and selling mostly online as well as physical sales from an outlet.
     
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  9. Tonibell

    Tonibell Well-Known Member

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    Cannot agree with it all - @Bayview is on the right track.

    Spending and investing habits will be a bigger factor in wealth development.

    So easy to just increase spending and consumption in line with your income.
     
  10. datto

    datto Well-Known Member

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    Save (borrow or steal).

    Buy property.

    Use leverage to buy more property.

    Wait ten years.
     
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  11. wogitalia

    wogitalia Well-Known Member

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    This is a bit of the old chicken and the egg...

    The easiest way to increase your income is to have the money to invest in the first place.

    Most people I know would say time is more of an issue for them than the money so I tend to agree with @Bayview here as well.

    When I didn't have the income to invest I also didn't have the time to do extra to generate more income to invest. Such is the life in a graduate position where you leave the house at 6am and get home at 9pm and spend every dollar so that you can live close enough to pull that off and then weekends are spent in the office as well.

    Now I have more time and more income because I'm no longer working the graduate slog and can afford to live closer to work so I knock an hour off my commute each was as well but of course with my tax rate there just isn't the financial payoff in any part time gig to justify the time they take. I could drive Uber's for $7.50 an hour after tax but I find my time is much better spent on research, education and relaxation and things I enjoy. Credit to anyone who actually would use their free time to earn something like that.

    The saying it takes money to make money is spot on and @Bayview's suggestion of controlling expenses is a more realistic and sustainable path to doing that than grinding oneself into the ground. Now that I have a capital base with which to invest I make far more money than I ever could doing things like Uber but it has taken a lot of discipline and work to get to that stage and for most of it I didn't have the time to work more which is the vicious circle for low income earners.
     
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  12. Special order

    Special order Well-Known Member

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    No offence but your whole post sounds like you've been making excuses for everything your whole life and even now your still making excuses for everything.

    There is a quote I invented to help people, maybe you will find some comfort in it

    "Weakness is only in the mind and pain is only weakness leaving the body"

    Hope this helps
     
  13. wogitalia

    wogitalia Well-Known Member

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    I think you should try re-reading what I wrote, at no point have I made excuses for my success, I'm not even sure why anyone would make excuses or apologise for their success that has come from hard work and sacrifice but by all means you can apply whatever meaning you want to my post.
     
  14. The Y-man

    The Y-man Moderator Staff Member

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    For us, it was a dodgy dude that stole our deposit for our first property. He ran off, and we still had a real and binding contract. So we had to get 2nd jobs to try to make up for the lost deposit.

    The Y-man
     
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  15. mrdobalina

    mrdobalina Well-Known Member

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    I know plenty of people on relatively high income ($300k +), who have very little investments and are not wealthy.
     
  16. Adele

    Adele Well-Known Member

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    This guy I know, started his business as a roadside vendor ( if you would even call him a vendor) selling clothes out of a plastic bag. He worked smarter, got really good at what he does. Fast forward 15 years, 20 stores later he probably wouldn't have imagined his own success.
    Every time I think I can't do something, I think of him and his plastic bag and how he managed to do it. I don't think Give Up was in his mindset at all.
     
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  17. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    I have lots of dem in my client base

    Broke at a higher level is all, and in fact can be much harder to get "free range"

    ta
    rolf
     
  18. wogitalia

    wogitalia Well-Known Member

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    Creating wealth takes effort and sacrifice no matter how high your income. It's literally delayed gratification.

    Having said that, most people I've met earning at that level or higher actually enjoy their job and don't see the idea of working until they're 70 or 80 as something to be avoided if at all possible. The people earning less than that and not living the great life that spending that kind of income each year allows are the ones who see wealth as an escape from somewhere they'd rather not be.

    The people who fall into the both category are the guys you meet that are retired at 35 because they had the substantial income needed to create the substantial wealth to not have to work anymore!

    A lot of people also don't really live for the future which is what wealth is all about, again wealth is quite literally putting off an opportunity now in the hope to have the ability to do 2 or 3 or 10 in the future!
     
  19. kierank

    kierank Well-Known Member

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    For me, the first step was to get motivated.

    That is, the pain of doing nothing had to become greater than the pain of doing something.

    Seeng the way my grandparents were living on the aged pension did it for me.

    Then all this other stuff (increasing income, saving, getting educated, investing, setting goals, having a plan, etc) took place.
     
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  20. larrylarry

    larrylarry Well-Known Member

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    Interestingly for me, I experienced a moment at a train station some 5 or 6 years ago... I was standing on a platform and my eyes were drawn to a gentleman in his 50s I think, grey hair, in suits and carrying a briefcase heading to the Sydney city. That image frightened me. A host images stated rushing into my mind and I decided that I will start my own thing. It wasn't wealth that I was concerned with because I will still get a good wage but I wanted to carve my own destiny so to speak.
     
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  21. Charlotte30

    Charlotte30 Well-Known Member

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    For me the experience of watching a friend who I thought was well off, die broke in a Retirement home. Over a 20 year period, she lost her job, bought a business, sold house to support business. Business failed. She was a very proud, intelligent woman. My visits to her just reinforced my decision to invest in property. To have choices. It was a great motivator.
    Cheers
    Charlotte30
     
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