Almost everyone has at least a basic understanding of several successful philosophies like the 17 success principles written by Napoleon Hill including many more self-help experts.
Recalling all the financial seminars being conducted as far back as 1998 coupled with what personally has been observed from successful individuals, I have come to the conclusion that there are 7 vital requirements or Golden Rules to being a successful investor. For anyone desiring to be successful, I believe he or she must keep to the following 7 Golden Rules of Smart investing accordingly:
- You must increase your learning before you earn and increase your investment value. What actually differentiates between your present status when compared to 5 or 10 years ago is that extra wisdom, experience and knowledge you have acquired till date. Similarly, you can only move up to the next level in life by upgrading your knowledge bank and skills. It is highly recommended that you invest a minimum of 5% of your yearly income on self improvement books, seminars and other materials. Ideally, all you need is just one excellent idea to have a dramatic turnaround.
- Effective Networking: Always ensure that you network with every like-minded individual to the best of your ability. As a matter of fact, it is not what you know that matters but who you know. Coming across a relevant person at the most appropriate time in your life can make all the difference beyond your imagination. Within your group of friends or masterminds, ensure that you are the poorest and least smart. If other friends are more well to do and even smarter, there is every likelihood that they will draw you up while climbing up. However, you are in for trouble if you are the richest and smartest because others are most likely limit your speed or even pull you down.
- Try to earn more and more within a possible time limit. I personally suggest that you move to a position where your prospects of earning cannot be quantified. Without any doubt, the standard technique of infinite earning potential is to be running your own personal business. Again, this will give you room to take calculated investment risks than the fixed income earners who are not self employed.
- Ensure substantial savings in order to develop the seed capital for investments. From my own point of view, I do not really have any belief in saving particularly when your savings are too meager for anything significant. Meanwhile, it is essential for everyone to save money for contingencies, but try to correctly position yourself so that you do not have any anxiety for saving, just allow it to happen naturally.
- If at all you want to borrow, then borrow with intelligence and ensure that what the borrowing is bringing is far superior to the cost of borrowing. Basically, how much you are able to borrow is one of the signs of how wealthy you are. So, do not be scared of borrowing but borrow smartly for good a fruitful purpose.
- Invest wisely: You may focus on real estate and stocks as the best form of investment. Try as much as possible to focus on passive income through business, renter and portfolio incomes. Let your attention be on how to generate cash flow more than the net worth.
- Keep improving on your knowledge experience and education. Always remember that learning has no end.