I often write answers on Quora, where I am the most viewed writer for investing, wealth and personal finance, with over 233 million views in the last few years.
On the answers below, taken from my online Quora answers, I focus on a range of topics including:
- What things have I learned as I got wealthier in terms of health, risk or relationships? What becomes more, and less, important?
- What is one tip that every aspiring business owner should know?
- What could be the future UK retirement age, and how will this affect a 41-year-old in the UK? What actions should be taken now to afford needing to work until you drop?
- When was the moment when I realised that being a millionaire isn’t just a pipe dream? I explain the two things which influenced me the most.
If you want me to answer any questions on Quora or YouTube, or you are looking to invest, don’t hesitate to contact me, email (firstname.lastname@example.org) or use the WhatsApp function below.
What are some things you realized as you got wealthier?
It is human nature, and in some ways sensible, to want things you don’t have much of.
People without money usually want loads of money, even if they spend their time criticizing “the rich”.
Older people tend to care more about time, as they have less left. This indirectly results in caring about family more.
Others care about status or making a difference in the world, if they perceive they haven’t done that before.
Most people who gain even a relatively reasonable sum of money, realize that money isn’t everything.
It is very important in the world we live in, makes our lives easier and enhances options.
Having none of it can indirectly result in the end of marriages, friendships and even your health due to the stress.
Yet time, health and our relationships with others is more important than simply adding more money carelessly.
That doesn’t mean that most people don’t want to become wealthier over time.
It just means that it doesn’t make sense to sacrifice health for more wealth, considering there are ways you can get wealthier without making such a trade-off.
Beyond that I have realized that
- The public view of who “looks” wealthy is widely off the mark. Most wealthy people aren’t flash. Most care more about wealth rather than mere income or “looking rich”. Few people could pick out a wealthy person from a crowd.
- Your opinion starts to matter. If you are a young upstart in your 20s with loads of great ideas, few take you seriously. If you have created a business and success by your late 20s and especially 30s, then everybody takes you seriously. Or at least those who know what you have achieved. In some ways this is sensible as we should judge people on results. In other ways it is ironic as most wealthy 32 or 35-year-olds aren’t 100x wiser or smarter than their broke 22-year-old selves.
- Preserving is more important than just growing forever. I have lost count of the number of formerly wealthy people I have met. Statistics seem to show this is the tip of the iceberg as most people don’t want to admit to this as it makes them look foolish. There are a combination of reasons for this including failing to tackle risks properly, divorce, bad spending habits and vices. Yet meeting a few former-millionaires is good for anybody who is complacent.
- Gratitude is important. Money won’t make you happy in isolation. It can help though, especially if you remind yourself of the bad times, and realize that you have only improved financially due to achieving another goal such as improving a business. There is nothing wrong with scaling your ambitions. In fact, it is important. Yet it is important not to become ungrateful as well.
I could think of more, but you did mention five.
What is one tip that every aspiring entrepreneur should know?
One thing to remember is there are broadly three kinds of people:
- Those who think entrepreneurship is cool. This is a new thing. In the 1980s or even 1990s it wasn’t.
- Those people who assume that getting a regular job is better. This tends to be parents.
- People in the middle. These are people who know the realities, including the positives and negatives
So, don’t do it for status or impressing other people. Many won’t be impressed.
Even if they are, do it for the right reasons. In other words, know why you want to do it.
Is it money? More security if you already have clients who can be transferred to the new entity?
Perhaps the lifestyle? Yes you need to work harder starting your own thing, but you can often decide when to work.
Know what motivates you and don’t be distracted by other people’s values in this area.
Other than that remember that
- Ideas don’t pay the bills, execution does. Consider this example. Let’s say you have the best ice cream in the world. Focus groups and consumer research has been incredible. You are very passionate about the product. Celebrities have endorsed it. Yet you stand outside an old people’s home on a cold, winter, day. Not many people will buy! In comparison, you will be beaten by somebody selling a standard product outside a children’s playground on a hot summer’s day. How you execute your startegy is key.
2. Passion isn’t everything. It is better to focus on what other people are passionate about, and want to achieve. Doing what you love is fine, but not if you are offering something nobody wants. Focus on solving other people’s wants and desires.
3. Get your hands dirty. Some people to use venture capital money to employ people, and outsource everything. Build up a business organically instead. Get good at the key business functions yourself before you outsource. Eventually it makes sense to delegate many things but only once you are strong enough.
4. Focus on what you know. Up to 90% of businesses fail, yet if you get a job first and get good at it, you are less likely to fail.
5. Control risks. That doesn’t mean being cautious. You need to take calculated risks. At the same time, make sure you aren’t focusing on one product, or one country. Also think about why other businesses fail, especially during times like Covid-19 when few prepared for unexpected lockdowns.
6. Don’t just focus on the quick buck all the time. Try to create long-term, sustainable revenue, with recurrent sources of income vitally important.
7. Learn how to communicate. Keep things short and simple as much as possible.
8. Don’t have a sense of entitlement. Just because you have a PHD, speak five languages and are smart doesn’t mean the market needs to buy what you are offering.
9. Always adapt. Look at Covid-19. Some businesses, even small ones, have adapted and are hitting record numbers. Don’t forget what has worked and is tried and tested though. It is a balancing act.
10. No book can prepare you for the process.
11. Don’t get into your comfort zone. Keep adapting.
12. Don’t care about what is normal. If you fail to break what is normal you will get normal results. You need to do things differently to get extraordinary results.
13. Failure isn’t a bad thing if you can learn from it. The key thing is avoiding “ruin risks”. Take calculated risks but make sure you are here to tell the story tomorrow.
14. Try to emigrate once in your life. If you can’t do that, live in different cities in your home country. Read a lot. Go to online mastermind groups. Meet, virtually, founders from around the world. Learn from everybody else without copying them.
15. Playing to your strengths is better than working on your weaknesses. our weaknesses are the one area that should be delegated.
I am 41. What age in the UK will retirement be?
Let’s look at the following facts:
- The UK, just like the rest of the developed world, has an ageing population.
- The debt is high and Covid has only made it higher.
- There are fewer people having children
- Public attitudes to migration to fill the gap have hardened. Even if they reverse, immigrants get old too.
- Life expectancy is only increasing
- Advances in medical technology could accelerate, with more people living longer.
When you consider these facts, it is highly likely that the retirement age will be 70–75 sooner than we think.
Of course though, that would be the “official retirement” age where you can take state benefits. Those who plan before can retire early.
The bottom line is that it is a mistake to rely on the state. Look at the so-called Waspi women:
The government retroactively decreased their benefits by forcing them to wait for longer.
The state pension is a Ponzi scheme. Not a scam, but it does depend on new people joining to pay older workers, or reducing benefits over time.
When did you realize that you can be a millionaire?
Growing up, the word millionaire had a kind of elitist meaning to it.
That did gradually change as asset prices rose, and so did inflation.
Yet some of those attitudes still exist. For me the two biggest turning points were:
- Reading the statistics on being a millionaire and multi-millionaire
- Meeting some in “real life”
These two facts made me understand that it isn’t as difficult as the media claims.
The media likes to imply that most wealthy people are:
- High-income or super high-income
- Very smart
- Extremely business savvy
- Inherited a lot
- Or a combination of the above.
This book challenges those assumptions
Most millionaires, at least in developed countries, aren’t high-income.
They aren’t usually super smart either. Typically they are middle-income and middle-aged.
A teaching who is approaching retirement as an example, or an engineer.
I was quite shocked to realise, as a young man, that 14% of the world’s millionaires were estimated to be teachers, a mid-level manager is one of the most likely people to become wealthy and many sports stars go bust – up to 78% according to this article.
Therefore, income isn’t the only factor in becoming wealthy.
How much you earn is important, but so is how much you spend and how the money is managed.
It didn’t completely sink in, however, until I met countless “everyday millionaires” in “real life” and even more high-income but low wealth people.
I could write a book about the number of people I have met who are earning hundreds of thousands but are broke.
That made me realise that whilst focusing on income was important, managing the money was much more important.
It is a bit like the fat person who wonders why they can’t out-run a bad diet.
Nobody can out-earn bad awful spending habits and multiple divorces.
It was then I understood that planning and being sensible was a big part of the equation.
To be clear as well, I am not saying that “get rich slow” is the only way.
There are numerous ways people can take calculated risks to make the process quicker.
Yet not caring about how to manage and spend money, and only on how to earn it, is like a sports team that has a world class attack but leaky defence.
Pained by financial indecision? Want to invest with Adam?
Adam is an internationally recognised author on financial matters, with over 233 million answers views on Quora.com and a widely sold book on Amazon
In the answers below I focused on answering the following questions:
- What is the most successful investing strategy? I compare professional and non-professional investors.
- Why do people keep saying that stocks will crash in 2021? I explain why people make this same prediction every year, and those who are foolish enough to listen, won’t benefit and can only lose.
- Which equities and assets will be most negatively impacted over the long-term by coronavirus?
- How can you get rich investing in US stocks?
- How can you use leverage to increase your wealth?
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