I’m currently reading a very interesting book entitled “The Millionaire’s Next Door”. I was fascinated with the title that I had to find a way to have a copy of this. After reading a few chapters, my view of the concept of wealth dramatically changed. I thought I’m wealthy when I have millions in my bank account; or when I live in a very expensive house in an upscale neighborhood within the city, or drive the latest brand of BMW or wears a P200, 000.00 worth of watch. To my dismay, this is not so. In the book, the authors Stanley and Vanko made a study of who really the real millionaires.
During their research, they interviews thousands of millionaires around the United States. After many months of visiting these so-called millionaires next door, they discovered that the real millionaires are not really what we perceive to be. Eighty percent (80%) of the real millionaires don’t live in a high class subdivision. They don’t wear branded apparels and accessories. They don’t buy the latest I-phone model or travel in a presidential suites. Some of them have been driving a car made ten years ago. The real millionaires in America are not the Hollywood personalities or the CEOs of a large and successful companies.
Who is the Millionaire Next Door?
Maybe the neighbor you fail to greet everyday is a millionaire or that man wearing an old shirt and a pair of jeans or it could be the person you meet daily. The real millionaires in the United State are ordinary people who live an ordinary life. Some of them are farmers, firemen, businessmen, and employees. They have accumulated so much wealth that even if they don’t work for the rest of their lives they will survive. And this is the meaning of wealth I want you to instill in your mind.
Wealth is measured by how many years you will live if income ceases coming in. Will you survive for the 20 to 30 years after you retire with the lifestyle you always wanted. If a person has monthly lifestyle expense of 30,000 pesos and his investment can sustain him until he died, is he wealthy? Or the other person whose lifestyle costs 200,000 pesos a month but can survive only for five years, is he wealthy?
For you, what is wealth?
As of this writing, I have been investing in the stock market for more than two years already . Since then, I have gained an interest of my money I put 100x more than a bank can offer in the same period of time. Moreover, I’ve discovered that investing in the stock market is not that all complicated like most people think. Perhaps, when they hear about the stock market, they would imagine a crowd of brokers facing a wide screen where stock prices of publicly listed companies are shown; or someone who has three to five monitors in front of him observing the rising and falling of stock prices of different companies and figuring out when to buy and when to sell. This is true for some, but not all. These people I was talking about are full time traders. They work eight hours a day in the stock market. That’s their job. They are being paid to do it. How about us? We can’t have all that time needed to monitor the movements of the prices since we have our own day job too.
So, what’s the solution?
To invest, and not to trade. Investing is long term and doesn’t need constant monitoring. On the other hand, trading is short term and needs closed monitoring.
How I started?
I hadn’t had any idea about the stock market until I attended a get-together about it. A certain CFA (Certified Financial Analysts) came to Cebu and conducted a short seminar on money management. At the end of his talk, he mentioned about investing in the stock market. More than two years ago I thought this kind of stuff is only for those who have millions in their bank accounts. In this short seminar my view of the stock market abruptly changed and I found myself excited and determined to invest as soon as possible. The next day I started researching about it and I was led to a book by Bo Sanchez entitled,” My Maid Invested in the Stock Market.” I read it and my whole perspective about investing in particular dramatically changed. I couldn’t wait to invest.
I opened an account in COL Financial, the biggest online brokerage at that time and I think it is still as of today (if I’m not mistaken). When I bought my first few stocks, I felt exhilarated. “Wow! I’m now a shareholders of big companies”, I told myself. Then my journey of learning about the stock market started. I read many books and blogs that are related to it. Since then, I have been learning new things about it.
How about you? Have you started investing already?