The plan to Get Rich Quick’ish isn’t complicated:
- Spend less money than you earn
- Invest that difference
- Eliminate/avoid debt
- Avoid lifestyle inflation
Do these four things and you can reach financial freedom in about 10 years. Easy to say, not always easy to do when life gets in the way. If you’ve ever lost your job, suffered a major illness, or had your business fail then you know what I’m talking about.
But sometimes we get in our own way and make boneheaded financial moves, like selling our assets. Selling a wealth creating asset is like killing the goose that laid the golden egg. Don’t kill your goose, keep it and let it produce!
I’ve sold wealth creating assets before, but these days I’m much more interested in collecting and accumulating them, not separating myself from them.
Selling an asset is like killing the goose that laid the golden eggs. Once it’s gone it can’t produce for you any longer.
— Ty Roberts (@GetRichQuickish) August 10, 2017
A few years ago I sold about $5,000 worth of stock to pay for a family vacation to Disneyland. The vacation was amazing and we now have great family memories that will last a lifetime. I’m happy we took the trip, but killing my goose to pay for the vacation was dumb, dumb, dumb! The smarter move would have been to save up for the trip instead.
With a little foresight and planning, we easily could have saved up enough cash to pay for the trip in a relatively short amount of time. Had I done so, I’d still have my vacation memories AND my stock (which would be worth quite a bit more than $5,000 today). The more time that passes, the more expensive my vacation ends up costing me because the asset I sold to pay for the trip just keeps getting more and more valuable.
Assuming an average 7% return, my $5,000 would have doubled in about 10 years. Then doubled again in another 10 years. By the time I’m ready to retire, that $5,000 would be worth over $20,000. Ouch!
Don’t kill your goose, let it produce! Keep it alive and healthy. Buy more geese. Trade one goose for another one, but whatever you do: keep your wealth producing assets!
Have you ever sold a wealth-creating asset and regretted it? Have you sold one and NOT regretted it? Let me know!