Building wealth and gaining financial independence is something we all strive to achieve, but only very few accomplish. But why is it that wealth creation escapes the majority of us?
Blogger: Brad Callaughan, Callaughan Partners
I think it’s important we look at the foundations that first need to be laid. Just like the footings of a building, we too must lay down certain foundations to become successful. To flesh out these foundations, I turned to the BRW Rich list 200 and BRW Young Rich list to find out from the people who know best.
So, here’s what those on the rich list used as their foundations of wealth creation:
1. They spend less than they earn.
2. They set aside a certain percentage of their profits or wages to invest.
3. They set goals and focus on achieving them.
4. They create a team of advisors that can guide them and provide them with the information they need.
5. They aren’t afraid to take calculated risks.
6. They persist. They never give up. They remove from their vocabulary words such as can’t, won’t work, hopeless, quit & impossible.
7. They use and leverage off growth. They make growth their friend. Buy it and leave it.
8. They always run in the opposite direction. They invest counter cyclically. We as human beings tend to follow, but for those few that invest against the crowd they are the people who always make it to the summit.
Unfortunately for most of us we never make it past number 1. For those who do make it past number 1 they normally fall at number 5 when fear sets in. Wealth creation is not about emotions it is about removing all your emotions and focusing on the deal, looking at the research, doing your number crunching and talking it through with your team.
If you want to make yourself wealthy you have to be willing to make sacrifices at the beginning. You have to be willing not spend that surplus income, but to put it aside and slowly watch your savings grow until you have enough to invest. Patience and persistence are needed to watch your funds grow and then to watch your investments grow.
Again, the majority of us would buy one investment property and aren’t happy to find we’re not immediate millionaires so we sell this investment too soon. This is not how wealth building works.
Remember slow and steady, knowledgeable decisions and calculated risks will get you there, and when you sense fear, turn to your team for the push you need.
About Brad Callaughan
Brad Callaughan is a specialist in taxation, accounting and business advisory. He is the managing director of Callaughan Partners that was formed to deliver and exceed client’s expectations, whilst charging upfront fees. Brad is an avid property investor and renovator. Brad is also a strong force behind the development as well as sitting on the board of the Ross Hutchinson Foundation. He can be contacted at http://www.callaughanpartners.com.au