The Secret To Building Wealth

Daniel Penzing
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Do you want to know the secret?

What would your life’s work be worth?

When you wake up every morning, what would you like your life’s work to be?

Taking the time to reflect on your life’s work can be a truly fulfilling practice. Not only does it result in a greater awareness of your purpose and calling, but it also allows you to utilize the resources available to you in the most efficient and meaningful way.

Imparting your work with meaning is rewarding on its own, and it doesn’t even have to involve a whole lot of work. In fact, if you’ve been struggling to find that deeper meaning in your work, you might be overlooking the simplest solution: just ask.

When you ask important questions, the answers you get are generally more accurate, and once you get your answer, you can move forward with confidence. So what do you want your life’s work to be? What is the meaning of your life? What is your purpose? These are just a few of the many questions you can ask yourself to uncover your life’s work, so don’t be afraid to get out a pen and a piece of paper and ask away!

Take Risk and Lots of It.

Successful investors are very comfortable with risk. Don’t be one of those investors who sleep well at night while losing money at the same time. This is one thing successful investors are willing to take and so should you.

Risk comes in many forms. Volatility is risk. It’s the degree of fluctuation that the market experiences. It’s also the degree of fluctuation that your portfolio will experience if you’re exposed to it. Risk is:

  • volatility in the stock market
  • short-term market price movements
  • dividend uncertainty
  • currency risk (if you have shares in foreign companies)
  • last, but not the least, risk is taking too much risk

The secret of becoming a successful investor is to experience risk but not too much. Over the long term, can you handle a 20% stock market correction?

Your emotions will always answer this question with no. Your investments will always be up when you ask someone if you are too risk at one point in your life but look pretty bad when you ask the same question at a different point in your life. People’s attitudes towards risk change a lot.

Emotional quotient is as important in investing as in trading. If you can’t handle the ups and downs, then you need to hedge.