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Secrets To Wealth
Investing for wealth
The next secret to wealth: investing. "Make thy gold multiply" and ensure "a stream of wealth that shall flow constantly into thy purse" (The Richest Man in Babylon).
To enable us to achieve our long-term goals, it's not enough to save. We have to put that money to work. If we just put the money in the bank, its value will be eroded over time by inflation and Government taxes.
In case you're wondering why investing is a secret, according to the report The Net Worth of New Zealanders (from the Office of the Retirement Commissioner), there is an astonishing $26,000 million invested in bank deposits. This compares with $24,737m and $18,887m invested in superannuation and rental property respectively.
A diversified investment portfolio will, over the long term, provide protection against inflation and will increase the value of that portfolio.
the Shape of Money has developed a series of topics to help you choose your investments. The topics are comprehensive and useful and include:
Once the investments kick in, you can then discover the magic of compounding growth. This refers to the growth of an investment by earning additional money on investment income. That is, if you reinvest your investment income, you'll then earn money on that. Money for jam, as we say at the Shape of Money.