Building Wealth Successfully

Creation and destruction of wealth is entirely in your own hands. You are the greatest asset and accountable for the make-up or the break down of wealth. All you need is knowledge and skill for creating it. So the best investment that you can do is ‘Invest in Yourself’.

In today’s world, there are more people who destroy wealth than the people who create wealth. There are basically three reasons for this:

1. Many people do not understand the meaning of risk and let their money stay in banks and bonds.

2. People who know the meaning of risk and initially move on the right path, get off-track in between due to lack of belief in their own self.

3. Most people have a fear of failure and as a result, they destroy wealth.

Lack of knowledge is the main reason behind the inability to create wealth and this lack comes from not trusting your own convictions, not believing in yourself, etc. Here are a few points that will help you understand better.

Understanding and correcting the concept of risk

Risk means unpredictability and it is innate in risky investors. You are more worried if your capital fluctuates but when your profits fluctuate, you are not rattled. Therefore you must first allow for profits to get created, which require time and patience. Risk of capital eroding decreases gradually with time if your profits have been built up.

Gain conviction

It is imperative to come to your own conclusions. For instance, if you did a study of say some company and wrapped up that this company has a great approach and will continue to grow at 15% for the next decade- the safest, brilliant and a highly rewarding investment avenue.

So why do you fear of putting 50% of your money is this company? The conviction that you are right comes from knowledge and investing in you own self, which is, investing in learning and building investment skills.

Your greatest enemy- not trusting yourself

The biggest mistake you do in stock market is not trusting yourself. It is not the stock market that is your enemy but you yourself are your greatest enemy when you don’t trust yourself. Don't sell when you see a good investment is down by 20 or 30%. Don't be timid and act in panic.

Understand that it is fleeting and not endless. Having fear is explicable but illogical behavior happens due to lack of knowledge.

Therefore, if you want to do something right, you should have the knowledge, skill and ability to do it right, else like it is said- “don't play with fire that you don't understand”.