what to do with money-becoming rich

hi everyone im a 16 yr old kid making a bit of cash through import export want to be filthy rich,
does anyone have any advice as to where i can invest my money
thanks

 

Invest some time in asking yourself how you want to get wealthy.

- Property
- Shares (indirect businesses)
- Direct Business

Asking 'How can I get rich?' is like asking 'How long is a piece of string?'. There are literally thousands of strategies you can use to become wealthy. It's just a matter of taking the time to explore your options, picking the (general) direction that you feel fits you best and going from there. Once you've made that decision, read read read. It will all come to you in time. At 16, you have plenty of it. As time goes on, you will hone your craft down to your preferred strategy.

Mark

 

hi
yeha ive been looking into properties butive decided i want a multiple income to build up some capital and savings etc to p[ut a deposit on an i.p when i turn 18
so im not sure wheather to look into shares etc:
are there any places i can read about them

 

If you want to buy a property at 18 (less than two years), shares are probably not the way to go, due to the nature of the market and your relative inexperience. Because I work in the finance industry, I can't say much, because it could be construed as advice, but there are a bunch of knowledgable people on here who can steer you in the right direction.

Having said that, if property interests you, I would strongly recommend the following books to you:

More Wealth From Residential Property
Building Wealth 101 - both by Jan Somers
How To Grow A Multi Million Dollar Property Portfolio - Michael Yardney
Rich Dad Poor Dad - Robert Kiyosaki (avoid his other books, they're crap)

Mark

P.S. Just as a side note - don't listen to anyone that tells you it can't be done. If you've thought of it, it has already been done by someone else, which means it can be done. It's up to you to decide whether you are willing to do what it takes to achieve what you want to achieve.

 

One of the best classics is "The Richest Man in Babylon" this is a must read.

Best for you is to open a managed fund, and get started with a regular monthly investment plan.

Then invest time and money into education into investing..

I would also suggest buying a house as soon as you can.. prehaps your parents can also help here for you to get started. buying a house will give you highest leverage into a stable asset. and you can live in it down the track!

 

hi yes
i already have the books
-rich dad poor dad
-how to grow a multi million dollar property portfolio

i will look into geetting the other books

i was looking into putting money into an ing direct account but i dont know alot about managed funds
can u please explain

thanks

 

You need to decide on the time frame you wish to invest your money for, if your going to invest for less than 3 years, than ING is the way to go. Share market investments are typically 5 years+.

A managed fund pools your money with other investors and the fund manager buys shares on your behalf. Some funds invest into things which would be hard for you as a individual to invest in, like say global property. Managed funds are also good for regular investment programs. With shares, you will need to have some money upfrount, as it wont be cost effective to buy new shares each month due to brokerage.

If you want to get started with a share portfolio, comsec have some share packs ready made, you might want to look at them, or fund some good managed funds to start with.

 

hi thank you

do websites u know anywebsites that i can get into managed funds on

also do u know anywhere that can give me more financial education, is there anything i can do to improve my financial education as i believe that is the key to being rich

 

I think your main advantage here is your age. If you start young, buy the age of 30 you can be in a very good position.. from here you can jump to the next level and become 'rich'..

buy a house early, that's my advise, and build up some Australian Shares (either directly or indirectly) then build on your knowledge by reading this forum, and go from there!

The trick is TIME in the market, not timing.. start early, as this is your biggest asset!

 

"The trick is TIME in the market, not timing...."


The real ‘trick’ (IMHO) is to know when you should be in the market and when you should be out of the market.

 

really? So tell me, when should we be in and when should we be out?

I don't think our good friend Warren Buffet shares this view with you.. he buys and never sells!

 

Okay, two issues with your post. Firstly, you're knocking someone who makes his living from trading shares (Tropo). Not the best move. If I had to choose who to take advice from in relation to shares between yourself and Mark, I know who I'd be choosing.

Secondly, once again you've made an inaccurate statement about WB. I wonder how much you've actually read up on the man, because you consistently make inaccurate statements about him and his investing style. As I stated very clearly in my post the other night, WB DOES NOT 'buy and never sell'. If you don't believe me, have a look at BH's holdings this year and compare them to say, 1998 and compare 1998 to 1988 and so on.

Mark

 

If you look at few charts you’ll get an answer.
When you get into the market you should know when you want to get out.
Who told you that W.B never sells?????

 

ok, as I have been corrected above, WB plans to hold for a long time. He is a buy and hold investor..

A chart shows what the stock HAS done, not what it WILL do..

If you can enlighten me on how to time your entry and exit points, I'm more than happy to listen.

I doubt the normal Joe Public will have the knowledge on how to time their entry and exit points.. so they can either invest via a managed fund, or buy companies for the longer term.

 

If I am not wrong, you’ve been claiming some trading experience some time ago, so you should have some strategy in place and to know when you should be in and/or out.
Correct entry/exit does not mean that you should be able to get bottom or top spot on every time (forget about it !!!!!).
If you are able to get most of the trend correctly you are doing well.
There are a lot of indicators/ways to choose from.

I am not saying that you or any other Joe Public should become a trader.
Far from it !!!!. It is a hard work!.
But you should become more active with your investment. There is a lot of books on this subject.

PS – My definition of buy&hold forever:
As long as XYZ is moving in the right direction I am in.
If one day XYZ changes direction (it may take even years), and I am getting sell signal from my system I am simply out – no matter how good XYZ is.
But again....It’s my way, and you or any other Joe Public may have a different ideas.

 

Tropo, so you use moving averages to identify a trend? and exit once the price is below your elected moving average? What do you do, use say a 200 day moving average?

Yes you are right, this type of management is allot more active, and not suitable for someone who wants a set and forget investment plan.

So currently you would be out of the market I assume, as the all ords are trending down?

 

Personally I do not use indictors at all (there is nothing wrong with indicators).
Example:
Open the XJO chart and use a 55 or 60 weeks MA and see what you get.
Use also 20 or 23 days MA on daily chart to tune your entry/exit.

Sure, you can use MA or other indicators and develop your own system.
Do not forget that without very basic strategy, you are moving like a blind person.

Your own investment should be treated as a business, so running a business requires a bit of work.
Do not think even one minute that by doing nothing you’ll achieve much (unfortunately life is not meant to be easy).

Of course, would be nice to invest in something and wake up 10 years down the track and find out that you are very rich.
Honestly, I didn’t meet anybody so far who did just that.
I’ve been told once ... NO pain - NO gain !!!!

"So currently you would be out of the market I assume, as the all ords are trending down?"

Market is trending down last 8 months+ (wake up ).