By Eric Roberge, Certified Financial Planner (CFP) and Investment Adviser, Founder | Beyond your Hammock | Source: Kiplinger
Most people waste a lot of time and energy seeking the one investment to solve all their financial worries. They want to unlock some secret that only rich people know about, thinking if they just knew that one magical place to put their money, it would make them wealthy, too.
I hate to break it to you, but that’s not how it works. The truth is that there is no perfect investment that will, without question, make you rich without time or effort.
But you could say there is a secret that the wealthy know that you don’t. You might not believe me, because it’s so incredibly simple. It’s not easy, however, or for the faint of heart.
The One-Word Secret to Wealth
Ready to know what the best-kept secret to financial success is?
See, I told you it was simple. But again, it’s not easy. You need to consistently make the right moves with your money day after day, week after week, year after year.
The good news is that anyone can do it, because this is more about what you do with the money you make, rather than the amount of money you earn. It just takes a ton of commitment, discipline, motivation and determination to take the right steps at every turn.
Financial success comes from consistently making smart decisions with your money, and then following through on those choices with your actions.
Consistency on the road to financial success looks like:
Saving and investing large percentages of your income (20% is a good target to reach for; 30% should be your minimum if you’re looking to grow serious wealth).
Spending in a way that aligns with your values. In other words, you use money only to gain what’s truly important to you and don’t waste resources on status symbols or material goods that don’t make you happy.
Keeping expenses low, even as your income rises, to avoid lifestyle creep at every stage of your life.
Avoiding big financial mistakes, like buying too much house or taking on loads of credit card debt.
Choosing an investment strategy that aligns with your needs and goals — and then sticking to that strategy over time (which will also require that you manage yourself and your emotions, and avoid making irrational decisions when markets get volatile).