I am often asked about my journey as a financial educator who aims to help people build wealth outside of the traditional system. Specifically, what were the critical decisions that led me to this point?
Success doesn’t follow a one-size-fits-all formula. I can, however, say that two crucial investments led me to becoming a multimillionaire. One is pretty common, and one may surprise you.
Before we begin, though, I want you to know that I didn’t inherit a fortune or become rich overnight. I had to learn the ropes the hard way to get to where I am today. I was broke and hungry at the beginning. Instead of trust funds or magic stock picks, it was all about making wise decisions and working hard.
Investment #1: The Stock Market (But Not How You Think)
We all knew this was coming – the first investment would be in the stock market. However, as I began my investing journey, things were very different.
As I mentioned above, I am not wealthy, did not inherit a million dollars, and did not lose half of a two-million-dollar investment (phew! ). As a child, I grew up in a family of financially broke parents, and bankruptcy wasn’t exactly a foreign concept.
I went back to school without any knowledge of investing. For me, this meant getting a finance degree and diving headfirst into the whole money-making thing.
My first investment? An underwhelming mutual fund for $25 a month. It’s not much, but at least it was a start! More importantly, I wasn’t looking to drop thousands or hundreds of thousands of dollars. Instead, I was just trying my hand at it, getting exposure, and learning.
Then, I began learning about mutual funds, compounding interest, and the stock market in general. However, I took a different approach – not something you hear very often. In most portfolios, 80-90% of investments are in index funds and S&P 500 stocks. That’s not me. While that’s not necessarily a bad strategy, it felt a bit… passive to me.
I invested my way.
Rather, I researched and invested in individual companies I believed in. These were companies that I used, loved, or thought had potential.
What was one of my first big wins? Under Armour. As I sweated out my brains in 130-degree heat while in Iraq, their gear saved my life. As a result, I knew I had to invest when they went public. It’s the same with Visa, Facebook, and a few others – all bought inside my Roth IRA for tax-free (or tax-deferred) benefits.
As Warren Buffett famously said, “Never invest in a business you cannot understand.”
Some people may not be able to benefit from this strategy. Since I had a business income to rely on, it was easier for me to take on more risk with stocks. However, it worked for me. Though I still love this strategy, I am now diversifying more into dividend-paying stocks — dividend aristocrats, anyone?
One of the best things about investing today is that you can start small, especially with all the online platforms and apps available. How about fractional shares? This is an excellent way to dip your toes into the stock market, gain real-world experience, and learn the ropes before investing your life savings. Besides, you don’t want to know about high-risk strategies after losing everything you have on a bad investment.
Investment #2: Building My Brand (The Unexpected Game-Changer)
What really made a difference in my net worth was not simply investing in stocks or growing my business. It was an investment in myself, in my personal brand.
Here’s what I mean:
- Becoming a Certified Financial Planner (CFP). There was more to this than just the fancy letters behind my name. The goal was to solidify my expertise, build trust, and stand out from the crowd. I was able to make a ten-fold return on my investment in this credential.
- Investing in my online presence. Everything mattered: the website, the business cards, the YouTube equipment. As a result of these tools, I was able to showcase my personality, expertise, and value proposition.
- Building relationships and networks. Contributing to Forbes, CNBC, and other prominent media outlets gained me traffic, enhanced my credibility, and opened doors.
But there’s a catch. In contrast to the stock market, measuring the return on investment for these efforts can be tricky. The purpose is not to make money immediately but to build long-term brand loyalty and trust. Sometimes, this is frustrating, especially if you don’t see immediate results.
However, these intangible investments are what truly distinguish you. Their work builds trust, attracts clients, and opens otherwise unavailable doors.
To quote the Oracle of Omaha again, “Your best investment is yourself. There is nothing that compares to it.”
The Takeaway: You Have the Power
What makes these two investments so attractive? There is no exclusivity involved. The stock market and the power to build a brand are accessible to everyone, including you.
Take a moment to consider this:
- It is possible to invest as little as a few dollars. With fractional shares and micro-investing platforms, it has never been easier to invest in the stock market.
- Building your brand doesn’t require fancy equipment or a huge budget. Start with social media, write guest articles and network both online and offline.
To succeed, you must take action, be patient, and learn from your mistakes. To achieve wealth, you need to take small steps, make smart decisions, and invest in yourself.
Now that you know what to do, what are you waiting for? Now is the time to invest in your future. You have the power to build wealth through the stock market, your brand, or both.
Don’t forget: it’s your money and your life, and only you can make it awesome.
FAQs
Disclaimer: In order to become a multi-millionaire solely through investments, you must understand the significant risks and uncertainties involved. Achieving such wealth isn’t guaranteed, and it’s important to make responsible financial planning a priority.
Which investment types offer the highest potential returns?
Historically, stocks have provided higher long-term returns than bonds or real estate. There is, however, a higher risk of loss associated with them as well.
The potential returns from startups, angel investments, and venture capital can be even higher. However, they carry extreme risks and require specialized expertise.
How much do I need to invest to become a multi-millionaire?
Investing depends on factors like your time horizon, risk tolerance, and desired return, so there is no one-size-fits-all solution. It is generally true, however, that the higher the potential return, the greater the risk and the higher the initial investment.
What is the safest way to invest for high returns?
It is impossible to guarantee a safe path to high returns. Although diversification across asset classes (stocks, bonds, real estate) helps mitigate risk, losses are still possible. For a more balanced approach, consider high-yield savings accounts or low-cost index funds.
What skills or knowledge do I need for successful investing?
It is essential to have basic financial literacy, a good understanding of risk tolerance, research skills, and the ability to analyze markets and companies. Depending on your circumstances, you may want to seek professional financial advice.
Is it really possible to become a millionaire?
You can become a millionaire. However, it takes dedication, discipline, and some luck. You can achieve your dream of becoming a millionaire by making the necessary sacrifices and committing to your goals.
