What’s The Best Investment For Australians Wanting To Retire Sometime In The Next 15 Years?
According to Roy Morgan, despite having less wealth and fewer savings to retire with, there are more Aussies wanting to retire now than ever before. And the number is growing each year.
In 2017 it was 395,000.
In 2018 it was 414,000.
In 2019 it was estimated at 439,000.
This is despite many Australians being below the recommended level to be self-funded in retirement. Meaning most Australians will sadly be pension dependent.
To make matters worse, the COVID-19 pandemic has seen over $65 billion of superannuation being taken out of super accounts due to consumers needing cash to survive.
The result of this is that over the next 50 years more Australians will reach retirement age with less. As such, more Australians will live out their golden years worrying about money, downsizing their homes, getting part-time jobs and struggling to survive on the pension.
This is why there has never been a more important time to learn how to invest wisely and diligently for the future.
However, only a tiny percentage of people ever really make the decision that they are going to take their financial future into their own hands and learn how to invest. Many simply leave their hard-earned wealth in the hands of mediocre fund managers who often perform worse than the market average and still find new ways to charge fees.
Because I spent many years talking about investing on TV, at least once a day I get asked one or more of the following questions:
What should I invest in to build my retirement nest egg?
Where should I be putting my money?
What are the hot shares?
Should I invest in Gold, Bonds, Real Estate or Crypto?
My answer never fails to surprise them (and rarely fails to annoy … at least at first).
You see, it’s human nature to want a quick fix. Especially in today’s age of social media, soundbites and slogans.
If you’re looking for a quick solution, the next big thing or some sort of “90 days to guaranteed riches” scheme then this article isn’t for you. However, if you’re at the point where you’re ready to knuckle down and get serious about building your wealth, then the following steps will do more for you than any ‘hot tip’.
Actually, before I share my insights, I’d like to challenge you to make a decision to get serious about building wealth. To make a commitment to yourself that no matter what you have done in the past and where your finances are at this point, that today, you’re going to start taking the actions you need to change your financial future.
Because unless you make that internal commitment to yourself, today, this will be just another article you read on the internet. And soon forget.
So, take a moment right now and think to yourself about what your financial future will look like if you get serious about your wealth today versus if you keep going the way you’ve been going.
Ok, ready to get started?
So, when someone asks me what the best investment you can make today for your retirement is, I borrow from the timeless wisdom of Mr Benjamin Franklin:
“An investment in knowledge pays the best interest.”
Now, at this point, if you like quotes, you’re probably feeling inspired. On the other hand, you (like the others I mentioned above) might be thinking, “What am I supposed to do with that.”
But if you bear with me, I’ll tell you.
In fact, I’ll give you some clear steps that will turn this 300-year-old philosophical quote into powerful progress on this exciting journey you’re embarking on.
From a wealth building point of view, the best investment you can make is…
Learning How To Invest
5 reasons why you need to learn how to invest
- Learning how to invest will help you build your retirement savings and nest egg to many times the size of just passively saving.
- Learning how to invest will give you the skills and ability to continue to build your wealth and income, even after you’ve retired. The majority of people retire with limited savings. When that goes, that’s it. However, as an investor, you’ll be able to continue building your wealth for as long as you keep wanting to play the game. And for many, that’s what it is: a game. Something that can keep your brain sharp while allowing you to live the lifestyle you want.
- It will change your life even sooner than that. Think about how much energy you spend worrying about money and the future. Your future, your families, your children’s. Even when you’re not thinking about it, it’s always there. Now, imagine all that stress gone. It doesn’t have to be 10 years down the track. Just knowing today that you have investments working around the clock for you, building your wealth, can change your whole outlook on life. Now imagine two or three years from now when you’ve started to accumulate some significant wealth. Just knowing that it’s there and knowing that you’re on the right path and making progress is a huge burden lifted.
- Learning how to invest and what the financial markets are doing helps you protect your wealth during (and even take advantage of) market downturns. In recent months we’ve seen just how important this is, as many people have lost a lifetime’s worth of savings due to Covid-19.
- Learning how to invest allows you to shove it to the fund managers and take control of your wealth and your future. Honestly, who doesn’t want that?
Unfortunately, while the majority of people say they want to build wealth, almost none take doing so seriously
Just ask them what the last investment book they read was. If you’re lucky, a few will tell you they read Rich Dad, Poor Dad about 10 years ago. But it’s a rare occasion to find someone who has read at least two high-quality books on Investment in the last 12 months.
Compare that to someone like Warren Buffet who is famous for reading for six hours a day. Whom on one occasion, when asked how to get smarter, held up stacks of paper and said, “Read 500 pages like this every week. That’s how knowledge builds up, like compound interest.”
It’s like trying to get fit and healthy without changing your lifestyle, the way you eat or doing any exercise. It’s not going to happen.
Like anything in life, building wealth is going to require that you put in a bit of effort. It doesn’t have to be monumental (like reading for six hours a day), but you do need to get started.
How to start learning to invest
There are five books on investing that I recommend for beginner investors. In no order of preference, they are:
- The Most Important Thing by Howard Marks
- The Intelligent Investor by Ben Graham
- Fooled by Randomness by Nassim Nicholas Taleb
- Security Analysis by Graham and Dodd
- Mastering the Market by Cycle Howard Marks
Now, if you’re not already a voracious reader, I recommend you pick one and get started this week. Even if it’s just for 15 minutes a day. Just. Get. Started.
The important thing isn’t trying to read them all today. The most important thing is forward movement. Movement that will turn into momentum, results and new habits and a new way of looking at the world of investing and wealth building.
Dedicate 15 Minutes A Day to Building Your Financial Intelligence
Think about a moment of the day right now that you’re going to dedicate 15 minutes to building your Financial Intelligence. For me, it’s in the morning.
I wake up, go for a walk on the beach to watch the sunrise, then come back, brew a coffee and read while I drink it.
Here’s a little life hack for creating a new habit: Anchor it to something you already do habitually. If you drink coffee in the morning, do your reading then. Or if you go to the gym, make your financial study the first thing you do when you get back to the house. If we don’t give it the time and space it deserves, we drift back to our old habits. But schedule it in and pretty soon it will become effortlessly enjoyable.
To make it even easier for you to get started, I’ve put together a FREE Fast Start ‘Intro to Trading’ Mini Course
In the course you’ll learn some of the key points from the books above, but I also lay out a framework that will help you start building wealth through smart investing.
Now, when I say Fast Start, I mean fast.
It’s seven concise videos of around five minutes each. Now, it’s not going to turn you into a world-class investor. Instead (and more importantly), it’s going to start building the habit that will, overtime, compound into a wealth of knowledge and investments that will set you free.
Then, if nothing more, get started by watching just the first video. It goes for just 4 minutes and 20 seconds. And you’ll be able to spend the rest of the day knowing that today you invested in the highest returning asset possible. Yourself.
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‘Intro to Trading’ Mini Course
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