OK – so that is a very “click-baity” title. But in my defence, I really have identified two ways to get REALLY RICH, and do it REALLY QUICKLY! To be clear, I mean fabulous life changing wealth in just a few years- or even a few minutes.
Since you know my goal is discretionary (and currently somewhat delayed ☹) early retirement, obviously I need money. So, the two most obvious questions are
- How much do I need?
- How will I get it?
The answer to question 1 is coming. But I am sure that right now you are more interested in the “HOW”.
Particularly the REALLY QUICKLY bit. So you don’t have to read the whole post here is the answer:
- Get REALLY, REALLY lucky – Not something that should be part of your plan
- Being dumb and then getting lucky – Not something you should do.
Sems like bad news, but fear not, there is also good news. I do believe you can get very rich (or more correctly “rich enough”) but those details are for future posts. *SPOILER ALERT* It takes planning, mindful action and time.
So please read on. Other than the (attempted) wit that I included (for free), I deliberately wrote this post early in the hope that people who are seeking to get rich read it. Hopefully, it can help them avoid common mistakes, or worse getting scammed. Alas, in any search for financial independence you will encounter some seemingly promising false prophets promising false profits. Oooh – see what I did there??.
So, I guess now you now need to decide whether to read on
Get Really, Really Lucky
This covers massive windfalls that require little or no input in terms of time or money but pay off MEGA. Think of winning Powerball or receiving a very large inheritance (hey – I never said it had to be good luck).
The good news is I am not saying you cannot pursue this (the Powerball approach that is). The bad news is that this can NEVER be part of a plan to achieve financial independence. Particularly, and I cannot stress this enough, NOT the inheritance angle.
Any plan should have a “reasonable” chance of succeeding. Defining “reasonable” without getting too “statisticy” (or given I am a FIDERman, should that be “statiSTICKY”) is a topic for another day.
However, given the chance of winning Powerball is 1 in 134 million – that doesn’t cut it no matter what your definition of reasonable. To put that in perspective, you have a better chance of flipping 26 consecutive heads with a coin (go ahead, try it, see many you can get). Or similarly, you have a better chance of thinking of your favourite celebrity, randomly typing in 8 digits in your mobile phone and having that celebrity answer (could be fun now that I think about it!).
To be honest, I have to admit that FIDERman does have the occasional punt on the Lotto/Powerball etc. Playing the “What would I do with that $10 million+ prize “ game with FIDERwoman is a fun time waster. However, despite a long history of playing the game, we don’t seem to be getting better. We did once have a 5 figure win, if we include the “cents” component. It was actually just a little over $100.00.
So in summary, FIDERman enjoys the occasional lotto purchase, but it is NOT part of the plan!
Being Dumb and then getting lucky
What I mean by this is investing a lot of time and / or money relative to your resources in a gamble or highly speculative opportunity (NOT AN INVESTMENT) and having it pay off to the tune of 10% a month (not per year) or 1,000x in a year.
You have probably heard that if you had invested a few thousand in Bitcoin, UBER before it listed, or used “Warren Buffet’s investing strategy” you would be reading this blog from your mansion on your own private island. Just about everyone has a story about the hot stock they were told about from a friend of a friend, or the hunch they had (but didn’t act on), or a great day trading methodology that would have paid off.
Firstly, for this to be life-changing you needed to have invested thousands of dollars (more likely tens of thousands) and timed it perfectly (potentially several times over). This is the allure of the “day trading” stories you hear about (or get offered!). But this little more than a coin flip, for every exciting win you read about, there are plenty of losses. And if you tried getting 26 heads in a row (see earlier challenge) you already know how hard it is to get even 5 in a row right.
Secondly, these highly speculative opportunities only be marketed as great investments in retrospect. Before they pay-off big time they are significantly risky – or better described as gambles. Even FIDERman’s FIDERsense can’t identify in advance which opportunities will pay off and which will fail.
Thirdly, if you can save a few thousand then the good news is that because of the beautiful maths of compounding, with a solid plan you can use this as a base to virtually assure yourself of financial independence. So why throw that hard work away for a long shot?
But what about those people who did make it rich by [insert amazing opportunity here]
Yes, some people have taken big risks and made big money. The Winklevoss twins have made hundreds of millions from Bitcoin. Warren Buffet has become mind-bogglingly wealthy from investing. Some very early investors in companies like UBER became fabulously wealthy.
These are often stories are the basis of those enticing (did someone say “click-baity”?) emails and short video adds you get bombarded with. The amazing trading systems, the next UBER, the next bitcoin – all can be yours for just a few thousand dollars.
Whilst it is very hard to be definitive about anything – as a rule these “opportunities” are complete and utter crap.
Notice how these emails and adds often reference those people or their stories and promise you the system that person used – BUT ARE NEVER FROM THOSE PEOPLE.
To make this statement really impactful, I want you to imagine another amazing superhero who enjoys wearing red spandex, namely Deadpool, pausing in the middle of battle and turning your way and saying it with that wonderful tone that Ryan Reynolds has nailed so perfectly.
Warren Buffet does not send emails seeking money to share his strategies, or promise incredible returns. In fact, he happily gives it away for free. You can easily find it in any number of YouTube videos or books you can borrow. Plus, he has been investing for over 50 years, never promises he will make money in a short period, rarely trades (he effectively just buys and holds) and has had several years where he lost money.
The Winklevoss twins don’t email strangers hoping someone will join them for an inside run at their next crypto investment. They made hundreds of millions from Bitcoin because they invested millions. They also got lucky with their timing! However, when they bought their bitcoin they had many other millions they did not invest into Bitcoin. So even if they lost their Bitcoin investment they would still have been multi-millionaires.
Yes, some early investors in UBER did great (maybe not some of later investors!). But at that time, UBER was just one of hundreds of start-ups with huge potential promising amazing returns. Can you name all the other start-ups at the time? Me either – because those start-ups went bankrupt, or returned very little. That is the inherent risk in investing in these companies.
The people email or advertise these amazing opportunities make their money by taking your money. Whether it be a deposit into some trading account that is quickly drained, or payment to some “guru’ for their secret betting system or next level day- trading course, it is a sure-fire way to make money – but for them not you.
Although FIDERman generally fights the good fight alone (apart from that wonderful recent stint when I joined up with the Afengers to defeat Fanos), I am pleased to know I am not alone in this particular battle.
I know it can be appealing, particularly in these times of low interest rates for deposits and volatility in shares, to jump on that “wonderful opportunity” for “only a few thousand” dollars. But please don’t, or at least be sceptical. Facebook regularly shows adds for systems that promise returns of 10% per month and claim they have worked for years. One even claimed to generate regular returns of 40%+ a month. So let’s take a (slightly quizzical) look at these claims.
Q: If someone had a system that generated 10% per month and $10,000 to invest, how much would they have after 6 years of using their system??
A: Just under $10 million. If they had sold their system to 10 people early on, they should have well over $50 million and not be seeking money from you!
Q: How much would they have after 5 and half years if their system generated 40% per month and they started with $10,000 ?
A: Over $44 TRILLION!!! That is more than enough to buy every single share of every single stock listed on the US market and Australian stock exchanges – with a few trillion to spare.
Q: If someone has such an amazing system, why are they offering it to you for less than $10 million?
A: They are exceedingly generous, exceedingly stupid, or lying. I will let you decide which.
Q: If you get offered the opportunity to get rich fast, with promises of amazing returns what should you do?
A: Do what a FIDERman does, hit delete, and swing the other away. Or if you have not yet mastered web-slinging and swinging, RUN the other way. Either way, do it REALLY QUICKLY*.
* Notice how I cleverly ended the post with same two words of the post title??**
** Excluding that footnote, and this one. Unless you read it REALLY QUICKLY 😊