There are more and more billionaires being made every year, and 2013 started with just under 1,500 people in the world being worth more than $1 billion. What do all of these people have in common? Aside from an extraordinary amount of luck, they made wise decisions with their money. Their business acumen is impeccable, and they have learned a few simple secrets about handling their money and investing wisely.
Hiring a lawyer from Acclaim Legal Services to help you handle your finances is just the first step, but finding investments is the next step in reaching your financial success. As you work with your attorney to find the best investments, keep these words from the wise in mind:
Find Investments That Will Pay Off Long Term
There are businesses that will yield immediate dividends, but how successful will they be in the next 5 to 10 to 30 years? A business that sold personalized floppy disks may have killed in 1990, but they would have become obsolete in 2000. Find a business that will be a valuable investment in the long run, one that will keep paying dividends for years to come. Look at the business model, the product or service they are offering, and the plan for the company. If it is reasonable to expect that the company could continue to yield high returns for years to come, it may be a good investment.
Let Your Fear Be a Marker
If you are afraid that a company you are considering investing in may not be a good idea, it may be time to listen to what your subconscious is telling you. Things that seem too good to be true usually are, and your first impression of the company may usually be right. Many wise men will tell you not to listen to your fear, but experts like Warren Buffet use their business and personal sense to get a feel for their potential investments. If they don’t seem like good ideas, they do research. With that research, they usually find out that their instincts were usually right. If your mind tells you to be wary with a particular investment, it’s worth listening to it.
Stay In Familiar Territory
If you have a food company, why would you suddenly branch out into shipping or the import/export business? Unless you have expertise in that area or an expert that can help you navigate through the complex industry, you’ll just be starting yourself off from scratch. Why not stick with what you already know. If you are successful in one industry, stay in that industry and find a new sector that has not yet been completely tapped out or tapped into. Just like Coca Cola found that selling non-cola soft drinks under a different name was the best way to expand their brand, you may want to consider a way to stretch your brand in the same industry — or at least in familiar territory.
Never Gamble it All
Many rich men have lost their fortunes overnight, and it was because they gambled everything they had on one business venture — or even 100. There is nothing that guarantees that your company will succeed, no matter how much capital you have to start off with. Never gamble all of your money on a company’s success, as you’ll go from riches to rags overnight if you should fail.
Warren Buffet has a measly $20 billion of cash on hand at any given time, while the rest of his prodigious wealth is invested. The amount of money that he keeps as a reserve is a pittance when compared to his vast fortune, but at least he’ll always have something to fall back on should something devastating ever happen to his companies, corporations, and other investments. You should always have a cushion on hand, as you never know when you’ll need a bit of cash or some liquid assets handy.
Be Adaptable
If you think that technology is the investment of tomorrow and you sink all of your money into tech, what will you do when solar power or food is the next big investment? Don’t stick with one thing, but change with the times. If you see that one of your investments isn’t paying off as much as you would have like, it may be time to accept the loss, pull your money out, and try some other investment that will pay off.
Don’t stubbornly try to make an investment pay off just because you think it should or the numbers show that it “could”. Be willing to take a hit, and be flexible and adaptable with your investments. Never be so sure of anything that you are willing to bet all of your money on it, but be adaptable and change as the world around you continues changing. Today’s “sure thing” may be tomorrow’s “could have been”.
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Written by Jon the Saver
This post was written by yours truly, Jon Elder. My mission is to help you succeed in your personal finance life. Join me on the journey to financial freedom! You can subscribe through RSS FEED or EMAIL updates. You can also find me on TWITTER
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. Happy investing 
Here’s a left-field factoid I never expected: the bulk of the portfolios of the super-rich are dominated by, of all things, bonds. Seems like the security of getting all your money back, with a pretty much guaranteed income, is more important to those folks than the riskier stock market.
When I heard that, my first reaction was: so THAT’S why I never invested in bonds before!
Here’s a left-field factoid I never expected: the bulk of the portfolios of the super-rich are dominated by, of all things, bonds. Seems like the security of getting all your money back, with a pretty much guaranteed income, is more important to those folks than the gains from the riskier stock market.
When I heard that, my first reaction was: so THAT’S why I never invested in bonds before!