It goes without saying that no one wants to be poor, that means you are very restricted in what you're able to do financially. In any economy, it seems that there will be haves and have nots. The haves can live life more easily, provided they live within their means and have ways of preserving that wealth, such as the ownership of assets which bring in passive income. The have nots, have to focus most of their energies on merely surviving and consequently, they don't enjoy any good quality of life, they often die earlier, and that is truly a pity.
What is the best means of becoming wealthy in your opinion, statistically speaking?
I think it might lie with investing in the stock market. What I'm inspired by is Ronald Read, who was a janitor who was low income for most of his entire life, only earning $12/hour at J.C. Penny's but managed to build a fortune of $8 million before he passed away at 92 years of age.
If he spent his money like ordinary people, he'd have definitely remained poor- but he found ways to make sacrifices to instead put that into investing, he never paid attention to stock charts or tried to beat the market. He just steadily built up enough equity in the most profitable companies in the world across a wide range of industries, a perfectly diversified portfolio which wasn't over-diversified either, less than 100 companies. All of the holdings being dividend stocks which were blue chip. The dividends were reinvested to build up even more equity and he repeated this process until it compounded to him getting $20,000/month in dividends which definitely would've pulled him out of poverty at that point.
I want to try to do what he did! I don't have to reach the same result, but if there is something that will enable me to do better than I was yesterday, I'll consider that a success. Of course, what works for one person may not be the answer for another person.
If everyone was able to invest in the stock market, I'd think that perhaps companies wouldn't be so willing to pay dividends. But if you built up equity in profitable companies, your investment probably will still grow overtime, provided the economy keeps growing from year to year.
Blue chip stocks are worth a lot because these are businesses which are expected to keep being around because they know how to do business. The penny stocks are worth pennies because these are capital starved upstarts which rarely survive and quickly go bankrupt and thus are much more of a risk. If one of the stocks you own goes bankrupt, you only lose the amount invested in that one stock, if you have a good portfolio, you could absorb such losses.
The potential boon to your earning potential and thus being able to live how you want, is why I want to learn how to invest. There are certainly obstacles in your way such as brokerage fees and so on, and it takes decades or longer before you can really "cash out" but the point is, it can be done and it will be there if you make the smart decisions.
If a janitor can do it, I don't see why anyone who has a job can't too at least to some extent. I certainly don't believe that everyone can become rich, but it is possible to become better off than you were. What can you be doing today that will get you richer than yesterday?
