The best investment in the world

 
MELBOURNE, Australia - Sept. 18, 2014 - PRLog -- There are two ways to approach making money - starting with a bag of money and starting without a bag of money. When you start with a bag of money your job is to grow it and preserve it, to get a return.

When you start without a bag of money, your job is to create capital, to make money. They are two completely separate functions and although the different approaches sometimes rub shoulders in the same markets, they are very different beasts.

I talk at a number of expos and association conferences through the year. The Australian Investors Association's annual conference for instance or the Australian Shareholder Association "Big Day Out", where the audiences understand their role. They are investors looking after a bag of money and they do so by exploiting well established markets in pursuit of an average return.

These markets include bonds, managed funds, listed investment companies, exchange-traded funds, equities and property. But while they can hope for extraordinary returns in these investment markets, it is well understood that you will not achieve them without besting the averages through some dramatic edge, superior intellect or stroke of luck that propels them beyond one to five standard deviations of the normal return.

It is the way of the world, there is nothing for nothing and thanks to costs, inflation, tax and predators most of the traditional investment markets are not going to make you rich. Handled right they may just keep you rich, but that's about as ambitious an expectation as you should allow yourself.

So you can invest, but I am afraid almost all of you will not "make it" in the investment markets. You will make it somewhere else and where people go wrong, especially young people, is to approach these rather average investment market returns, especially after costs and inflation, thinking this is where they will make their fortune. What a waste, because in doing so they are overlooking the best investment in the whole world, the lowest-risk investment, the highest-potential capital return investment, the one investment they already know inside out and upside down, the one investment they can trust, the one investment they can control, their own brain.

So while I admire the young people and especially the young couples who turn up to better themselves by learning about the equity markets or the property market, the truth is, I'm sorry, you're in the wrong place.

There are only seven ways to get rich that I know. Win the Lotto; be born rich; marry rich; inherit; lie, cheat and steal; or, the two options that don't involve beating long odds or ending up in prison - spending your time and energy building on the most important, low-risk, satisfying, long-term investment available: you, your career or your business.

Ask around. Read Rich Dad Poor Dad. The only people who get rich from nowhere are those who develop their career or a business. It's the easiest, most productive investment you'll ever make. Invest in that, build on that. Build your asset. Educate yourself. Learn skills. Plan. Focus. Envisage. Progress. Value your employment and exploit the opportunity it provides.

Keep taking steps and at the end of it all you will walk away with a lot more than money. You'll walk away with certainty, integrity, satisfaction and an asset that provides stability, safety, reassurance and longevity. An asset that will quite literally, as long as you are alive, never stop giving.

Buy an apartment in the Melbourne CBD or some shares in BHP and you build nothing. You are simply investing. But develop your brain, develop your skills, develop your career, develop a business and the experience and the returns are perpetual, exponential and beyond many standard deviations of the norm.

There is an equity market theory that diversification is for people who don't know what they are doing and that it is better to invest 100 per cent in one thing you know all about than in 20 things you don't.

Your best investment is staring you in the mirror. Invest in that. My Archie is 12. He is already showing an interest in business. He has three sisters he wants to offer out as part of a business called "Archie's Babe-e-Sitting". He's drafting their code of conduct and designing their shirts. Tell me he's not going to make it. And there's not a BHP share or a CBD apartment in sight.

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Location:Melbourne - Victoria - Australia
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