Making Money is Easy
The secret to wealth is keeping it
Over the years my husband and I have made a lot of money from our online businesses while living our semi nomadic lifestyle.
From six figure membership sites and blogs to a seven figure ecommerce business and lots in between.
We’ve also been expert spenders.
Living in a pool villa in Phuket, Thailand which in the last 10 years has become as expensive as a Western country (just Phuket, not Thailand as a whole). Seeing our daughter through a very pricey international school, travelling around the world, and generally being a pair of spendthrifts!
The result is some 14 years later even after a string of successes we’re yet to meet our ultimate financial freedom goals.
However, luckily for us, a few years back we started on an investment journey which not only contributes to the lifestyle we now enjoy, but will also give us the freedom to build more businesses and improve our lifestyle further over the coming years.
More importantly we put our 18 year old daughter on this path after she inherited some money from her Grandmother, and right now if she continues in the way we’re educating her, she’ll be very wealthy by the time she’s 35 if not before.
Here are the most important things we’ve learned and have now implemented (later better than never);
1. Start investing now, regardless of the amount.
The power of compound interest is truly transformative, but it requires time to work its magic. Even small, regular investments can grow significantly over decades. Don't wait for the 'perfect' moment - the best time to start is now.
Ryan Moran from Capitalism calculates it as follows - If you invested $541 per month into the S&P 500 and it produced an average return of 9.4% (which it has averaged for the last 50 years) You would be a millionaire in 30 years.
30 years sounds like a long time, but it feels like I was 20 just a second ago. Start now, not 30 years from now (no matter your age) and keep growing that pot.
2. Prioritize investing over luxury spending.
Instead of splurging on fancy cars or expensive gadgets, adopt a more frugal lifestyle and redirect those funds into investments.
This doesn't mean living like a hermit, but rather making conscious choices about where your money goes.
The temporary satisfaction of a brand new Tesla pales in comparison to being financially free forever.
3. Diversify your investments across different asset classes.
This includes index funds (which provide broad market exposure), real estate (either directly or through REITs), bonds, and potentially some individual stocks or crypto if you're willing to do the due diligence. (Well calculated diversification helps manage risk and can provide more stable returns over time.)
However, if you intend to be an armchair investor heed Warren Buffett’s advice to Tim Ferriss - ‘I'd probably have it all in a very low-cost index fund, then I'd forget it and go back to work.’
4. Understand the relationship between risk, return, and time horizon.
If you’re a younger investor, you can afford to be more conservative, focusing on steady, low-cost index funds to harness long-term market growth.
As you get older and have less time to recover from market downturns, you might need to take calculated risks for potentially higher returns. (Crypto, DeFi, Angel Investing etc).
However, never take on more risk than you can afford to lose, and always do thorough due diligence before making any high-risk investments.
5. Educate yourself continuously about personal finance and investing.
This is a gift I wish my parents had given me, but it actually started with Robert Kiyosaki in my mid 30’s. I’m so glad I can share what I know now with my daughter.
The financial world is always evolving and never more so than right now!
It’s not a good enough excuse to blame everything on the government and your financial advisor these days. There are so many reputable books, channels, podcasts and blogs you can follow and learn from.
Plus I would seriously consider taking some courses on investing basics. Knowledge is without doubt power when it comes to managing your money effectively.
6. The fastest route to wealth is to start your own business.
As I pointed out in No 1. If you invest regularly for 30 years you can potentially become fairly wealthy (not withstanding inflation and the gradual devaluation of your funds). However the more you can invest along the way, the wealthier you can become, faster.
Therefore the ideal route is to start your own business, and generate enough profits to invest higher amounts in a diverse range of projects from index funds to real estate to other businesses.
Where so many entrepreneurs make their mistake (us included), is splurging their extra cash on a nicer lifestyle. Invest first. Lifestyle later!
Making Money is Only Step 1
So while making money is the main step that people focus on it’s just the first step.
The real challenge - and the key to lasting wealth - is keeping and growing what you earn.
Our personal journey has taught us that it's never too late to start making smart financial decisions, nor is it ever too early.
We’ve been a bit late to the game, but are making up for lost time, and more importantly we’re so happy we can gift our daughter these early lessons in financial literacy.
As the old saying goes ‘Give someone a fish and you feed them for a day. Teach them to fish and you feed them for a lifetime.’
Whether you're course correcting like we have been or just starting out I hope these principles can set you on the path to true financial freedom.
No matter what, get started towards your future wealth today!