Have you ever wondered why you haven't achieved the financial success you so desire? Do you understand what it takes to reach that elusive destination, financial freedom? Anyone can have the success they desire. I dare you to become financially free.
A good definition of financial independence, by the way, is the control of an income stream sufficient to support your current standard of living.
You do not just fall into financial independence. More than anything else, the secret to real wealth is the mindset of wealth.
So you see, my dare is not really as outrageous as it might sound at first. By accepting the challenge, you are taking the first step to acquiring the mindset of wealth. You must be resolved to the fact that with wealth building, there must be dedication. And I guarantee that the opportunity to become financially independent is waiting for you, but you have to make the decision to go for it.
It's up to you to take that step across the threshold of opportunity facing you now. It's a decision you should have no hesitancy for. And when you do, you're on your way to financial independence.
There are four major hurdles you must jump to become financially independent. I could go into a deep explanation of each step but I will save that for another time, I really want to discuss a powerful investment strategy. But I will briefly outline the four steps to financial independence.
So to get started, lets begin with the first of our skills of wealth building and that is earning. You must understand the two basic components controlling your earning power.
The first of these is our ability to perform our chosen line of work, that is, how well do we do what we do. The second and probably the most important factor controlling our earning power, is the demand in the marketplace for whatever it is we've chosen to do.
Any rich, unprogressive old party with that particularly grasping, acquisitive form of mentality known as financial genius can own a paper that is the intellectual meat and drink of thousands of tired, hurried men, men too involved in the business of modern living to swallow anything but predigested food. For two cents the voter buys his politics, prejudices, and philosophy. A year later there is a new political ring or a change in the paper’s ownership, consequence: more confusion, more contradiction, a sudden inrush of new ideas, their tempering, their distillation, the reaction against them.
—F. Scott Fitzgerald (1896–1940)
Second, you must build a financial protection account to cover all your expenses in case of an emergency, such as the loss of your income source. Saving is really the second important skill for acquiring wealth. You must have the discipline to build a protection account that will cover all your living expenses for your family, for a period of a year or two.
The third step in becoming financially independent is to begin an investment program. You want to achieve the highest returns on the money that you have designated for your investment program. Your objective now is to accumulate a mass of capital that will generate sufficient income to support your lifestyle without your having to work.
The fourth step to financial independence is too develop enough investment prowess to earn the extra income that allows you to fill your wants and desires. You have your needs met, but now you want to create the extra income that allows you to become financially free, this is where you can basically satisfy most of all your wants.
There, now that we have the four basic steps to financial freedom. I would like to carry on with the main focus of this article.
But I must make it clear that I had set up multiple Avenues of Income first, to put me in the financial situation that affords me the ability to test the waters of many different financial opportunities.
So, now I would like to discuss a powerful investment strategy. This is an investment strategy that has worked well for me in all types of market conditions. And by no means is this a strategy that I designed. In fact, it's one that has been used successfully from a time long before the modern market and the stock exchange even existed. It's called value investing.
Value investing is the best long term strategy for creating wealth that's ever been devised. The theory behind it all is remarkably simple. You can become a value investor by investing your money only in under-valued assets. You can find under-valued assets in stocks and bonds, real estate or a wide variety of other investment opportunities. But whatever the investment asset may be, value investing boils down to the equivalent of buying dollar bills for pennies.
Now, I am sure you are saying "If it's really that easy, everyone would be doing it." I want to assure you easy as it actually is, everyone is not doing it. As with all great ideas in the world, only a few recognize them for what they are, and fewer still then decide to act on them.
The personal touch between the people and the man to whom they temporarily delegated power of course conduces to a better understanding between them. Moreover, I ought not to omit to mention as a useful result of my journeying that I am to visit a great many expositions and fairs, and that the curiosity to see the President will certainly increase the box receipts and tend to rescue many commendable enterprises from financial disaster.
—William Howard Taft (1857–1930)
Under-valued assets exist for reasons that range from fluctuations in the economy to fluctuations in human emotions.
It's important to understand, however, that you can always find undervalued assets if you are willing to look for them. And, you don't have to do this all by yourself. Look for investment professionals who operate investment funds and companies using this strategy. Through study and practice you will learn to accurately assess values as a basis for profitable investment.
Another key mindset of wealth is thinking and acting like a business person as well as an investor. Remember the better business person you are, the better investor you'll be. And the better investor you become, the better business person you'll be.
Please also keep in mind that value investing may offer important opportunities to take an active role in creating value in your investments. For example, you might turn an unwanted piece of real estate into an income producing asset, or turn a failing business into a thriving business, or create a new product or service based on a need or want you see in the marketplace.
Another form of value investing is investing in yourself and your abilities. There are many ways of increasing the cash flow into your families finances.
Setting up avenues of income that could hold the possibility of creating a passive and/or residual stream of income. If you take the opportunity to set up another stream of income, you would really be increasing your ability to grow anyone of your other investments. And, there are many ways of creating an extra souse of income that doesn't consume every spare minute that you have. To the contrary, making such a move in your life would possibly result in you're having even more free time to do the things you love.
The options are endless. The possibilities of a whole knew future are there for the taking.
Hi, I am a 43 yr. old semi-retired Financial Advisor and Estate Planner. If you are interested in some investment ideas visit http://www.avenuesofincome.com I have also authored a book about what I consider to be one of the best opportunities to earn an income from working online http://www.membershipsite-success.com.