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Do You Have the Discipline for Making $1million?

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meditation by oddsock @ http://www.flickr.com/photos/oddsock/3701520219/ An article in Motley Fool by Chuck Saletta shows “How to Make $1 Million”.

The information and the method to do it is out there. In libraries and out on the internet. In the book, “The Millionaire Next Door”, the guy who ends up comfortable in retirement with a million bucks is often the ordinary teacher, technician, small business owner who squirrels away savings and invest it rather than the hot shot broker or BMW driving lawyer.

The difference is discipline.

Discipline to keep putting money saved to investment. Discipline to keep investing even though market is doing down and moving against you. Discipline to keep vested when everyone is yelling “sell” in fear. Foremost is the discipline to keep saving.

I remembered reading a quote that said that you can invest whether you have high IQ or low IQ. But I think to invest requires you to have courage and balls of steel. Because when the market tanks, you should be able to sleep soundly knowing you are getting more shares for your investment kitty rather than fretting over the dropping prices.

In fact, some guru in investment even said that in order for you to invest, you must first ask yourself if you can still sleeping knowing that the market has just tanked and dropped 50%. Which it did a few months ago in March when it was down 60%.

Near the eve of Christmas, I hope that more people become interested in investment and take the time and effort to become more knowledgeable in this.

“Saying you don’t know, don’t understand, it is too complex” are just excuses. With a little effort, it isn’t that difficult to learn the concepts.

As Forrest Gump said in the same movie, “Lieutenant Dan got me invested in some kind of fruit company (referring to Apple). So then I got a call from him, saying we don't have to worry about money no more.”

Most of us don’t have a market guru working for us, and even if you think he or she is, what if they turn out to be Bernie Madoff wannables?

My solution is to invest in the whole market through ETFs, and index funds with some money as recreational investment where you invest in those stocks after analysis and imagine that you are Warren Buffett junior.

You can surf around and see that there are bloggers out there who does a very thorough analysis of companies. One of them is Musicwhiz. There are lots of bloggers from Singapore and United States that are very good and writing great articles about how to invest better, save more etc. Do click through some of the links.

May you start soon on your own journey to attain financial freedom.

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2 comments:
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la papillion said...
December 25, 2009 at 3:19 PM  

Hi,

Regarding the book millionaire next door, just wanted to point out some conclusion drawn by the book.

In it, the author surveys quite a number of millionaires and analysed the characteristics of such people. Then he concluded that millionaires have this and that characteristics and therefore the implication is that if you have such characteristics too, chances are that you'll be a millionaire.

Hmm, I think the author forgot to see the hidden side of the statistics. I'm sure there are many people out there with such characteristics too but didn't become a millionaire.

Same thing - millionaires are mostly disciplined folks. But being disciplined doesn't necessary make one a millionaire.

Hey, have yourself a merry xmas :)

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Lemizeraq said...
December 26, 2009 at 11:27 AM  

Hi La Papillion,

Thanks for visiting again.

I actually thought that the book's reasoning was a bit too simplistic to say that these are the characteristics of a millionaire and if you have been, you will be one too.

And yes, even if people have these characteristics, they may not end up being a millionaire too, because I think some luck comes into play too.

Merry Christmas to you and I enjoyed reading your post about 2009 and the 5 things you learnt/accepted.

Lemizeraq

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