And remember, if you lose, or worse, you choose to spend that $5,000, you have nothing but a pile of stuff.
As you can see, the upside is much larger than the downside when invested safely and correctly. That’s how to create wealth over the long-term without gambling.
So let me flip my coin. You decide if you’re going to play or not. I’ll be here on the sidelines watching my money grow.
Did you play? If so, did you win?
If you won, well, congratulations, but that’s called a short-term win. Sometimes they do happen and you can make some good money, but here’s the thing.
If I flipped this same coin 100 times, I would have something extremely close to 50 heads and 50 tails (if you don’t believe me, read this and be prepared for heavy nerdiness), which means if you won and kept playing, you’re either going to lose eventually or break even.
Most investors, when trading in and out of funds like this, and freaking out over short-term market fluctuations, end up making really bad decisions, and because of it get returns in the 2% range.
By staying invested for the long-term, taking advantage of high growth index funds, following strategies like dollar cost averaging, and trusting the history of the last 100 years, returns of 10% annually and higher over the long-term are possible.
We’re Not Gambling Here. We’re Following a System
One of my favorite movies is “21” with Kevin Spacey and Jim Sturgess crushing Vegas with a professional blackjack system, which actually happened several times, and still does.
Kevin Spacey’s character has a quote in this movie that says:
We’re counting cards, we’re not gambling. We’re following a specific set of rules and playing a system.
In the movie when the team “gambled” and didn’t follow their system, they lost. When they did, it paid off handsomely.
And that’s my point with this exercise.
Investing is not gambling when done correctly.
Wealth creation is not about tomorrow, next week, or next month.
You don’t get rich by predicting the next Microsoft or Amazon, no matter how much you dream about it. People that do that get lucky, or have information that normal people do not.
We’re not gambling here. We’re following a system. We’re investing.
Creating wealth is all about the results you achieve over long-term. It’s about making smart and educated decisions that benefit your long-term future and taking consistent action to continue growing that wealth.
Don’t fall into the trap the financial press sets for you, trying to get you to trade in and out of the next big things.
Warren Buffet, the most legendary investor who has ever lived, and the 3rd richest person in the world, said it best.
Someone is sitting in the shade today because someone planted a tree a long time ago.
If you really want to create wealth in a smart, and proven way, understand that an 8 – 10% growth rate over time that has extremely high odds of working out for you, is far better than tossing all of your money on red and crossing your fingers for a good number to come up.
Take it from a guy who likes to play blackjack at the $5 tables for fun. I’ve made 1000x the money in the stock market than I ever have at a casino, and it was a whole lot easier too.
Coming Up Next in the Four Biggest Myths of Wealth Creation
Next up, is the final myth in the Four Biggest Myths of Wealth Creation series, and is the most important one of all that holds people back from creating large amounts of wealth in their lives.
I personally see this myth wrecking the financial lives of dozens of people on a daily basis, although I’ve been able to help save many of them from it recently.
I’m excited to share it with you. That video will be coming your way on Sunday, September 7th at about 8:30am.
I’m also going to make an announcement towards the end of video regarding my newest flagship course, 401k Millionaire. I am going to be opening it up for enrollment on Sunday morning, September 7th. During that video, you’ll find out what you need to do in order to get registered for the course.
If you’ve enjoyed this series, you’ll love what I’ve put together for you in 401k Millionaire.
Again, the final video is coming your way in a few days, on Sunday, September 7th. It’ll be in your inbox if you’re an email subscriber. If not, you can get signed up anywhere on the blog. Don’t miss it! I’ll see you then.