I went to an investment workshop, Investomania, last month and wanted share some valuable information that’s rare to find publicly. While this post may not seem as exciting as my usual traveling posts, it includes important insights regarding your finances. The events in the coming months will impact your finances drastically, but you can take preemptive actions now to thrive despite the economic recession we’re entering.
At Investomania, top investment advisers shared their most novel insights. One of the thought leaders of the financial industry mentioned that never in the history of the global economy has the rate of change been so rapid. Even though our economy seems to be doing fine, banks have not recovered from the 2008 crisis.
In fact, banks recently stopped lending to one another. The Financial Stability Board released a list of 29 financial institutions that are “too big to fail.” Failure of any one of these banks would trigger a domino effect rippling all over the world; currently two banks from the “too big to fail” list are at critical levels.
We don’t hear about this on the news because of society’s information pipeline. There is an information pipe in which the general masses are the last people to receive information. An example of this is that the US prints money out of thin air; in 2009 they printed 4 trillion dollars out of thin air. Did you hear that in the news? I don’t think so. The risk is too high to stand aside and to lose your hard-earned money.
At Investomania, the experts explained that we’re already in a recession. The clues of a recession include: the rise of interest rates, mortgage rates, taxes and property prices. All of these indicators are true today.
Below is some advice from one of these experts on how to protect your hard-earned money and build wealth. He’s an advisor to ultra-high net worth individuals so understanding and implementing this valuable advice can transform your financial situation.
1 Identify your fear and resolve it. Ask yourself what is stopping you from building wealth. Are you scared to lose money? Are you scared of looking stupid? Are you afraid you won’t understand investing or trading strategies? Are you scared of disappointing your parents? Figure out the root cause of the fear that’s holding you back and address it.
2 Do not listen to the media — listen to the facts. Sandy explained that, “When the media reports on something, it’s already too late for you to act.” There is an information pipeline with the general masses being the last people to receive information. You must also develop a strong physiology to avoid being sucked into the fear that the media produces. An easy way to do this is to stop watching and reading the news. Search for reliable facts and sources when considering investing, refinancing your home, asking for a loan, etc.
3 Diversify assets to be prepared. This relates to the point above. When you hear about a trend like tech stocks or cryptocurrencies, it’s already too late. In order to avoid volatility caused by speculation and trends, diversify your assets to decrease your risk. This means buying land, gold, stocks, bonds, real-estate, etc. so that when an industry experiences turbulence or the government enacts regulation, you won’t be a deer caught in headlights.
4 Plan your prosperous future. Sandy explained that, “Poor people think about today. Middle class people think about months. Rich people think about years. Wealthy people think about decades. Elite people plan for generations.” Make a plan, create a strategy and take action consistently.
He highlighted that traveling is where he learned his most valuable skills. He recommends changing jobs to cultivate transferable skills, building businesses to reclaim ownership of your time and going on big adventures to learn more about the world.
Here are his 7 keys to succeed in business and life:
- Profitable: before considering a venture, ensure that the business will be profitable. Ex: You can do this by doing comprehensive market research on your customers to confirm that there is a demand for the product or service that you are creating.
- Scalable: how can you increase your earning power? Ex: You can ask for a promotion, rent out your apartment on Airbnb, sell your old clothes or start a business.
- Portable: organize your business so that you can work from anywhere. Ex: Create a business that gives you the freedom to work from any corner of the word. Ideally, all you will need is a laptop and reliable Wi-Fi connection.
- Manageable: you can’t track what you can’t measure. Develop appropriate metrics to track your progress. Ex: I do this by tracking the number of visitors I have on my blog and social media to see where I need to improve on my marketing strategy.
- Transferable: cultivate skills that are transferable. When learning something new, ask yourself if the skill transferable. Ex: My girlfriend is learning how to use Docker (a software tool). This skill is transferable because she can use Docker at her current job or use it to develop her own app.
- Enjoyable: being passionate about your work ensures you don’t work a day in your life. Ex: I quit my corporate job to build my blog and crystal business, which excite and drive me.
- Charitable: the more you give, the more you get back. Give with no expectations.
He also recommends reading The Alchemist by Paulo Coelho. My uncle gave me this book and it’s not only a great read, but a transformative book that encourages you to pursue your biggest and wildest dreams.
It may seem like a lot of work to re-plan your finances and future, but the risk is too high to stand back and do nothing. It’s time to do something different.
When the 2008 economic crash hit, I was in high school, and at the time the only indicators of what was happening in the economy was seeing my friends lose their homes. Seeing foreclosed houses and families deeply frustrated over finances became normal, but I didn’t truly understand the impact of the crash. Fortunately, I’m now more aware of what’s happening in the economy and I hope to share this knowledge so that you, too, are equipped with the tools to establish your family’s financial security.
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