Open Your Eyes with McKay Christensen S4E50 - Discover Real Wealth
Today on the Open Your Eyes podcast, McKay talks about creating lasting wealth, and opens up the episode with two stories about Charles Ponzi and Bernie Madoff - both of whom schemed investors out of billions of dollars. He points out that, unlike Ponzi, Madoff, and their corrupt practices, in order to create genuine wealth, one has to define what wealth truly means. The next step according to McKay to generate wealth is to save and invest, and goes on to urge the audience to diversify these investments in order to best mitigate risk.
Last but not least, McKay argues that investors simply think differently, and if people want to be wealthy they should do so as well. Investors think like owners, whereas the ‘average Joe’ might be more likely to think that their income is sufficient enough to live on without investments. This is why McKay believes so strongly in the power of financial education - after all, if we don’t take the time to learn the game, how are we ever supposed to play it?
The Finer Details of This Episode:
- The story of Charles Ponzi
- Deciding what real wealth means to you
- The importance of saving and investing
- Diversification and averaging
- How to minimize taxes
- Why investors think differently
Quotes:
“When something is too good to be true, it most likely is. I can’t tell you the number of times people have come to me telling me about the latest sure thing, and that sure thing doesn’t turn out.”
“These schemes often promise high returns with little risk. Educated investors understand there is always risk.”
“Riches are not an end in life, but an instrument in life.”
“The goal of good investing is to get your money working for you. This seems obvious, but getting the right mindset about investing is really important.”
“When you get educated, you’ll learn that the older you get and the closer you come to needing your money to live on, the more you need to reduce the chances of volatility.”
“An investor thinks differently. They don’t think about how much they can earn as an employee, they think about how much they can earn as an owner.”
“Determine what real wealth means to you. Get your plan established. Start investing today. Build a diversified portfolio, and average into the market. Take advantage of tax advantaged investments. Get educated, and give 10% of what you earn.”
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