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Personal Rules to Avoid Losing Your Wealth

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Envision

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I think focusing on the long term is the only key. It factors into everything else and applies to all asset classes.

You look at the wealthiest people in the world and the vast majority have achieved that over time through strong compounded investments.

I dont really think you need to diversify (it can help) but you do need to compound at a known rate of return. All of my wealth has been made from decisions I started 6/7/8 years ago.
 
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EvanOkanagan

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A few that have worked for me...

Track your net worth consistently and make sure it's going in the right direction.

I've been doing this since I was 19 (34 now). I was 10k or so in debt so I didn't think it made much sense at the time, but it's helped me build a habit of watching my expenses and making sure as few of them as possible are taking away from my net worth. I'll use furniture as an example: we just purchased a lightly used bed frame with dressers that's solid teak wood for $1,000. This is likely worth at least that in re-sale since we bought it used and no one will be able to tell the difference. We may even be able to resell it for $1200 or more down the line--so essentially even though we spent $1,000 there's no decrease in net worth (and likely an increase since we scooped it for a deal).

Lifestyle creep added in small increments relative to your wealth/income/cashflow.

This is similar to "live below your means", however, I feel success should be celebrated (while not breaking the rule above). A number of years back, I had really wanted a smaller luxury sedan (new Caddy) which would cost around $600/mo at the time. So I set a goal to increase my monthly cashflow to $1500/mo in order to realize this. Once I hit the goal and added that extra investment income (bought 3 rental properties), I went out and leased a new Caddy which was a step up in lifestyle while also keeping a healthy amount of the cashflow. I don't do this every time I hit a milestone, and as time goes along I would say I'm living further and further below our means, but also have improved on the lifestyle front (mostly more travel these days).

Once you find an investment/business you're successful with, nurture it.

Similar to avoiding "shiny object syndrome", if you have learned and have success with one type of business or investment, keep repeating what you've done and improve on it rather than trying something new. This for me was Real Estate (biz as a Realtor and investing in small multi-family rental properties). When I had my first early success, I strayed away for a short time and tried e-commerce. This took my attention away from Real Estate and I was half-in on both. I pulled myself together and decided to stick with what was working which ended up paying off well with rinse-and-repeat. Net worth has grown a couple mil, and enough cash flow to be on auto-pilot if I want from the rental properties, but that time of distraction likely cost me in the long run as it took me out of the game for a while.
 

MJ DeMarco

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Track your net worth consistently and make sure it's going in the right direction.

Great point, I never really thought about this but I've been doing this for decades as well.

There are very few months when my Net Worth reverses backward, and if it does, it is usually because of some big expense like building a house.

For me mentally, knowing that every month I was headed in the right direction was BIG, even if it was only a few hundred bucks (Back when I was still slaving at a job).
 

MTF

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Great point, I never really thought about this but I've been doing this for decades as well.

There are very few months when my Net Worth reverses backward, and if it does, it is usually because of some big expense like building a house.

For me mentally, knowing that every month I was headed in the right direction was BIG, even if it was only a few hundred bucks (Back when I was still slaving at a job).

I started doing it last year and calculate it at least every other month (and if I remember, then every month). It's very, very helpful.
 
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Dopemary guy

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So my number one rule now is take everything I can scrape together and put it into cryptocurrency. There’s never really been a bad time to get in, time has been healing all mistakes with your entry point with bitcoin. I’ve been a consultant, helping people buy sell and stake there a Crypto since 2017. It’s really rewarding helping my clients make life-changing wealth.
 
D

Deleted78083

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The above rules are for people that have a big net worth and want to avoid losing it - the title of the thread.

For people at the beginning of their journey, the rules are different.

The question isn't "is this 500k RE deal a good, or a bad deal"? Rather, it is "will a freezer help me save on food because I'll buy in bulk, or will it cost me more because of the energy expenses?"

So, here are my sidewalker financial tips - there aren't really rules.

Hum.

1. The biggest expenses will be on food, transportation, and rent.

2. Food: buy in bulk and freeze to decrease both time and cost spent on groceries and go buy directly at the producer or at the wholesaler if you can.

3. Transportation: a car is a trap (Europe is different than the States in this regard). Don't use public transportation in cities. Bike, and if it is not flat, get an e-bike that you can charge at work if you go to work with it.

If you do buy a car, get a van, because:
- It is cheaper
- You can rent it out
- You can sleep inside
- You can take with you a lot of people when you drive from point A to point B and you can charge them for doing so.

4. Rent: buy a 3/4-bedrooms apartment and lease 2/3 rooms in a way that the rent your tenants pay refunds the mortgage (as explained in the gold thread) OR live for free at your family's place OR volunteer in a hostel and stay there for free OR buy a studio in Bulgaria for 10 000 euros.

5. Tech: use Google shopping to buy the phone/computer that you seek and search for prices in other countries (in my case: Netherlands, Germany, France).

6. Clothes: go to open-air markets or second-hand clothes shops or to a wholesaler directly. Buy from companies selling overstock.

7. Services: watch a Youtube video instead of calling whoever you need to repair what is broken.

8. Don't buy physical books. Only buy ebooks.

9. Hairdressing schools often offer free haircuts if students can practice on you.

10. All you need is food, water, wifi, a computer, and clothes. The rest is garbage you don't need.

11. Travel in winter. Buses and ridesharing are underrated.

12. Always book any travel services on the Internet, and always compare prices on different websites.

13. Heating expenses are lower in warm countries than in cold countries.

14. Don't pay for bank accounts.

15. Greece is cheaper than Norway.

16. Most of the time, the internet offers cheaper options than in real life, but places where there is no internet will offer cheaper options than the internet.

17. Be an early bird in asset investment and product use.

18. No one will better manage your money than you will if you dedicate time, care, and resources to the practice.
 

jeandearme

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As you get older, you will understand. At 31, you're still a spring chicken who probably isn't contemplating "end of life" scenarios too often -- the older I get, the more and more the luxury car thing starts to lose its appeal.
Have you considerer working out and taking adaptogens? My dad is 78 and he had more and more thoughts about the end so I decided to move him from the couch and now he has less thoughts like this and we didnt put any supplements on yet. Age is just a number, after all. Is there any good of thinking about "end of life", anyway?

P.S. I'm also a spring chicken in that example.
 
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WJK

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The above rules are for people that have a big net worth and want to avoid losing it - the title of the thread.

For people at the beginning of their journey, the rules are different.

The question isn't "is this 500k RE deal a good, or a bad deal"? Rather, it is "will a freezer help me save on food because I'll buy in bulk, or will it cost me more because of the energy expenses?"

So, here are my sidewalker financial tips - there aren't really rules.

Hum.

1. The biggest expenses will be on food, transportation, and rent.

2. Food: buy in bulk and freeze to decrease both time and cost spent on groceries and go buy directly at the producer or at the wholesaler if you can.

3. Transportation: a car is a trap (Europe is different than the States in this regard). Don't use public transportation in cities. Bike, and if it is not flat, get an e-bike that you can charge at work if you go to work with it.

If you do buy a car, get a van, because:
- It is cheaper
- You can rent it out
- You can sleep inside
- You can take with you a lot of people when you drive from point A to point B and you can charge them for doing so.

4. Rent: buy a 3/4-bedrooms apartment and lease 2/3 rooms in a way that the rent your tenants pay refunds the mortgage (as explained in the gold thread) OR live for free at your family's place OR volunteer in a hostel and stay there for free OR buy a studio in Bulgaria for 10 000 euros.

5. Tech: use Google shopping to buy the phone/computer that you seek and search for prices in other countries (in my case: Netherlands, Germany, France).

6. Clothes: go to open-air markets or second-hand clothes shops or to a wholesaler directly. Buy from companies selling overstock.

7. Services: watch a Youtube video instead of calling whoever you need to repair what is broken.

8. Don't buy physical books. Only buy ebooks.

9. Hairdressing schools often offer free haircuts if students can practice on you.

10. All you need is food, water, wifi, a computer, and clothes. The rest is garbage you don't need.

11. Travel in winter. Buses and ridesharing are underrated.

12. Always book any travel services on the Internet, and always compare prices on different websites.

13. Heating expenses are lower in warm countries than in cold countries.

14. Don't pay for bank accounts.

15. Greece is cheaper than Norway.

16. Most of the time, the internet offers cheaper options than in real life, but places where there is no internet will offer cheaper options than the internet.

17. Be an early bird in asset investment and product use.

18. No one will better manage your money than you will if you dedicate time, care, and resources to the practice.
I like your list. Even when you crest that hump and you have more money under your belt, you'll still think as you do now about most things. We still live "on the cheap" about a lot of things. And that's one of our secret weapons in this financial game. Our lifestyle hasn't really expanded much over the years. The blitz and the bling don't mean much anymore. We worked too hard to get here and it hurts to spend hard-earned dollars on silly stuff. My stepkids thought we were the cheapest people on earth until they grew up and tried it all themselves.
 

WJK

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Have you considerer working out and taking adaptogens? My dad is 78 and he had more and more thoughts about the end so I decided to move him from the couch and now he has less thoughts like this and we didnt put any supplements on yet. Age is just a number, after all. Is there any good of thinking about "end of life", anyway?

P.S. I'm also a spring chicken in that example.
Your thinking will change as you grow older. The things that were so important to me when I was young no longer matter. I just don't care anymore. I can look at stuff and my heart doesn't go pitty-pat and my eyes don't turn green. I'm happy for the guy who has all that bling. I just don't want to take any of it home if it requires special care, dusting, hand washing, polishing, or otherwise is a pain in the a&%^^.

I know that I'm in the closing chapters of my life and I'm happy to be here. I wouldn't be young again for anything. Those young years were painful and scary. These current years are a lot more gracious and thoughtful.

The main thing that wanted when I was young was to have choices. I had to work long hours to pay the bills. I had to go to school (college and professional classes) and incur student loans in order to better myself. I had to transverse hellacious learning curves in order to learn how to navigate the business world. All the while I was making bone-crushing mistakes that were all part of that journey.

I still make mistakes, but they are manageable and part of the cost of doing business. Now at times, I feel like I have too many choices. What irony.
 

jetsetter883

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Have you considerer working out and taking adaptogens? My dad is 78 and he had more and more thoughts about the end so I decided to move him from the couch and now he has less thoughts like this and we didnt put any supplements on yet. Age is just a number, after all. Is there any good of thinking about "end of life", anyway?

P.S. I'm also a spring chicken in that example.
Couldn't agree more. Too much info out there about "retiring", "end of life", etc.. gets people thinking mostly in terms of downside scenarios.

My father might be similar to yours. Retired, spends much time on couch, constantly reading boomer magazines about what to do with money when you die, etc. Some will argue he's being responsible. I argue he's contributing to an earlier than necessary demise.

Not to get political, but consider a guy like Trump. Yes he's rich af and could "retire" however still concerns himself with building and producing rather than obsessing about "end of life" scenarios. Yes I'm sure he has some of this figured out, but that's besides the point.

In fact the older I get the less I seem to concern myself with "retiring" and everything that goes with it. Sorry not sorry.

Edit: This is not to say that you should be deliberately and completely unconcerned with matters pertaining to what may or may not happen in your latter years, but concentrating on only downhill scenarios is unlikely to be of benefit to you.
 
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MJ DeMarco

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Have you considered working out

LOL, I've only been working out for 30 years.

Too much info out there about "retiring", "end of life", etc.. gets people thinking mostly in terms of downside scenarios.


My "end of life" thoughts have nothing to do with me physically or thoughts of dying, or downsides.

It is an awareness and a detachment to the vanity crap that ultimately means nothing in the grand scheme of things. Of course I like luxury, but it's luxury for the sake of my own enjoyment, not for people to go "oooo and ahhhh" -- worse, in today's culture, you're more likely to have butthurt Sidewalkers vandalize any luxury sportscar because it telegraphs that you're one one of those evil rich guys who doesn't pay their fair share, as if 50% of my income going to taxes isn't enough.

I'll take my secluded luxury cabin in the woods away from civilization over some six-figures Mercedes to impress the impressionable.
 

jetsetter883

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LOL, I've only been working out for 30 years.




My "end of life" thoughts have nothing to do with me physically or thoughts of dying, or downsides.

It is an awareness and a detachment to the vanity crap that ultimately means nothing in the grand scheme of things. Of course I like luxury, but it's luxury for the sake of my own enjoyment, not for people to go "oooo and ahhhh" -- worse, in today's culture, you're more likely to have butthurt Sidewalkers vandalize any luxury sportscar because it telegraphs that you're one one of those evil rich guys who doesn't pay their fair share, as if 50% of my income going to taxes isn't enough.

I'll take my secluded luxury cabin in the woods away from civilization over some six-figures Mercedes to impress the impressionable.
All good, I wasn't necessarily directing my thoughts toward you personally. In fact I wasn't at all.

Agree that luxury is great if you're doing it for you and not for others, though I think it is a false assumption that people who purchase luxury items these days must absolutely and positively be doing it to "show off" and that they most definitely cannot afford it. These types of people certainly exist of course, but probably not 99% of people who purchase luxury as the narrative would have us believe.

With that said, I would take the log cabin as well.
 

WJK

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Couldn't agree more. Too much info out there about "retiring", "end of life", etc.. gets people thinking mostly in terms of downside scenarios.

My father might be similar to yours. Retired, spends much time on couch, constantly reading boomer magazines about what to do with money when you die, etc. Some will argue he's being responsible. I argue he's contributing to an earlier than necessary demise.

Not to get political, but consider a guy like Trump. Yes he's rich af and could "retire" however still concerns himself with building and producing rather than obsessing about "end of life" scenarios. Yes I'm sure he has some of this figured out, but that's besides the point.

In fact the older I get the less I seem to concern myself with "retiring" and everything that goes with it. Sorry not sorry.

Edit: This is not to say that you should be deliberately and completely unconcerned with matters pertaining to what may or may not happen in your latter years, but concentrating on only downhill scenarios is unlikely to be of benefit to you.
We have our "end of life" issues all wrapped up. Our wishes are carefully thought out, written up, signed & notarized, and resting in our file with our estate attorney. It's all decided. There's nothing more to do about it -- unless we change our minds. We haven't shared the details of our arrangements with anyone (other than our attorney) -- and that includes our kids. We want them to be successful on their own. My husband and I are both "boot-strap" kids, who meet and married in the September of our lives. We each started with nothing and did the hard work thing all of our lives. We expect the same of our kids.

We're officially retired, but busy every day with our investments -- and we help a lot of people through those avenues. We sure don't sit at home on the couch. Come to think of it, we don't have a couch -- just comfortable chairs in our living room. And we're really glad to sit down at the end of the day.
 
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nothingness

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No consumer debt is key IMO.

And I never invest in things I don't understand. I watched the whole gamestop / amc thing play out, I could have bought in at $35, and I watched it go over $420, but I didn't understand their play (at the time) nor did I have any confidence in the big banks being forced to buy stock at peak to cover their shorts (because banks have a history of messing up and just getting bailed out) so I sat back and gained absolutely $0. I also lost absolutely $0 unlike a multitude of the WSB crowd.

Same with crypto. It's beyond my understanding. I know people who lost their crypto when interacting with their wallets, it's just too complicated for now.

I live a "boring" life to others yet to me it's fantastic as I live a very secure life. Just being out of the 9-5 rat race feels like winning the lottery to me. On the weekend when you find my peers out partying, doing drugs and drinking, you will find me sat in an empty room meditating. I wouldn't have it any other way.
 

WJK

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No consumer debt is key IMO.

And I never invest in things I don't understand. I watched the whole gamestop / amc thing play out, I could have bought in at $35, and I watched it go over $420, but I didn't understand their play (at the time) nor did I have any confidence in the big banks being forced to buy stock at peak to cover their shorts (because banks have a history of messing up and just getting bailed out) so I sat back and gained absolutely $0. I also lost absolutely $0 unlike a multitude of the WSB crowd.

Same with crypto. It's beyond my understanding. I know people who lost their crypto when interacting with their wallets, it's just too complicated for now.

I live a "boring" life to others yet to me it's fantastic as I live a very secure life. Just being out of the 9-5 rat race feels like winning the lottery to me. On the weekend when you find my peers out partying, doing drugs and drinking, you will find me sat in an empty room meditating. I wouldn't have it any other way.
I agree. I don't invest in anything that I don't understand. And I prefer to be in control of the situation. That's why I like my real estate. Being "boring" cuts out a lot of drama and heartache.

Your post reminded me of a funny story about my husband. He LOVES to gold pan on the streams here in Alaska during our summers. So, we take the RV and go camp for a few days. If we're there on a weekend, come Sunday afternoon, he tells the other miners around him, "I think I'll just stay for a couple more days. I'm just not ready to go home yet." They ask what he's going to tell his boss. They all must get back home to be back to work on Monday. He explains that he has a really nice boss. (He leaves out the part where he helps me, his wife, with my businesses.) I've heard him go into great detail about the big job he does around here. If I'm present when he pulls this gag, I just compose my face and nod in agreement.

It sounds like you have a similar situation.
 

nothingness

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Similar but I don't tell people my situation, it leads to envy, jealousy and hate, and you never know if/when you will see that person again.
What I do however occasionally, when I start losing the gratitude, is get up at 7am, SSS, get into a suit, drive to a distant tech park, then drive home. I force myself to experience the 9am traffic jam start of the rat race so I can appreciate how I'm no longer in it. We have this thing in our brains where our "baseline" of standard of living is constantly changing, so our desires are constantly evolving, it's hard to keep gratitude with this mechanism at play.
 
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WJK

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Similar but I don't tell people my situation, it leads to envy, jealousy and hate, and you never know if/when you will see that person again.
What I do however occasionally, when I start losing the gratitude, is get up at 7am, SSS, get into a suit, drive to a distant tech park, then drive home. I force myself to experience the 9am traffic jam start of the rat race so I can appreciate how I'm no longer in it. We have this thing in our brains where our "baseline" of standard of living is constantly changing, so our desires are constantly evolving, it's hard to keep gratitude with this mechanism at play.
I provide affordable housing for my community so I get reminded often of how fortunate I am. My tenants have problems and troubles that I left behind long ago or never had. They buy a new car and can't afford the payments or the gas to run that vehicle. They blow their money on gifts; then can't pay the credit card bill. They book trips and can't afford the shuttle to take them to the airport. I watch people do all kinds of wacky things all the time. You're right. It gives me a great appreciation for my decisions and my situation.

Your other point is interesting. I think one reason why it had to keep that grateful attitude is that our lives change slowly and we're looking out from the inner circle. It's hard to see those changes, their effects, and appreciate them when you are at the center of that change.

On the other hand... Yes, one becomes acclimated to a higher standard of living pretty fast. That new car loses its special smell pretty quickly. And in no time, it needs to be washed and detailed. Yesterday's thrill-a-minute is tomorrow's yawm. Anything can become pedestrian and routine.
 

nothingness

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Yesterday's thrill-a-minute is tomorrow's yawm. Anything can become pedestrian and routine.
Interestingly I have found three things that never become pedestrian and routing.

Meditation, and charitable giving, not necessarily just via donating wealth. But actually going out there and doing it. And finally, friendships. The wealth just provides the lifestyle that can make these possible.
 

Chester Morgan

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Your thinking will change as you grow older. The things that were so important to me when I was young no longer matter. I just don't care anymore. I can look at stuff and my heart doesn't go pitty-pat and my eyes don't turn green. I'm happy for the guy who has all that bling. I just don't want to take any of it home if it requires special care, dusting, hand washing, polishing, or otherwise is a pain in the a&%^^.

I know that I'm in the closing chapters of my life and I'm happy to be here. I wouldn't be young again for anything. Those young years were painful and scary. These current years are a lot more gracious and thoughtful.

The main thing that wanted when I was young was to have choices. I had to work long hours to pay the bills. I had to go to school (college and professional classes) and incur student loans in order to better myself. I had to transverse hellacious learning curves in order to learn how to navigate the business world. All the while I was making bone-crushing mistakes that were all part of that journey.

I still make mistakes, but they are manageable and most of them can be fixed by this awesome platform. It has saved me so much time and money you can't even imagine :) Now at times, I feel like I have too many choices. What irony.
I couldn't agree with you more :) For some reason people think that being young is the best what can happen to a person but young age also has its disadvantages like lack of experience and poor worldview.
 
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WJK

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I couldn't agree with you more :) For some reason people think that being young is the best what can happen to a person but young age also has its disadvantages like lack of experience and poor worldview.
Years ago, I had no idea that all those other choices were out there. I was too young, myopic, and inexperienced. I simply didn't know. Would I make other choices now if I had the same types of situations? Of course. Then I must remind myself that did my best with the resources I had available to me at that time. I'm younger at heart in my 60s than I was when I was 16.
 

thechosen1

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Years ago, I had no idea that all those other choices were out there. I was too young, myopic, and inexperienced. I simply didn't know. Would I make other choices now if I had the same types of situations? Of course. Then I must remind myself that did my best with the resources I had available to me at that time. I'm younger at heart in my 60s than I was when I was 16.
if you're still in your 60's you have lots of time left :D your best years could be ahead of you.

My grandpa is 81 and still captains his company as CEO. He's there every day. Works more than anybody else, too, growing the company.
 
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WJK

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if you're still in you're 60's you have lots of time left :D your best years could be ahead of you.

My grandpa is 81 and still captains his company as CEO. He's there every day. Works more than anybody else, too, growing the company.
Yes, I'm in my 60s. This is the best time of my life. I started in the real estate business 46 years ago when I was a young pup. Now I'm a seasoned 'ol dog. I too work every day -- just like I have since I was 11 years old. I tried retiring about 19 years ago and I'm just not good at it. Boring! I totally failed to keep myself busy and interested in life.

FYI -- I'm starting a new business right now to create additional streams of passive income. Currently, it's just a side gig to my core businesses. But it's fun & exciting to do something new. Maybe I'll be able to grow it up into something wonderful.
 
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SEGA SAPH

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Here are some of my rules, thinking off the cuff...
  1. Having your cash lose 5% from inflation is better than losing it 100% from a bad investment.
  2. Trust no one who doesn't have to be accountable for their actions or isn't subject to a minimal amount of governance -- sometimes bigger is better.
  3. A fancy website and slick copywriting doesn't mean its legit.
  4. Invest in what you know, but learn to expand what you know...
  5. The more complicated an investment, the better probability it will end up as a method and the means for bad actors to scam the uneducated.
  6. If everyone is doing it, I won't be doing it -- or better, I'd approach it from the "shovel" perspective. (Sell shovels in the gold rush).
  7. Try to keep liquidity at least 30 days away, best case, 1 day.
  8. Always make sure the worst case scenario (black swans) doesn't put you back into the poorhouse-- if the "worst case" has you looking for a job, you're poorly diversified and rolling dice.
  9. Would you sell and take gains if the actual cash was in front of you? And not a number on a computer monitor? (See picture)
  10. Beware of Diodetic expenditures -- buying a Lambo causes a lot more expenditures outside of the cost of the car itself -- gas, insurance, maintenance, car washes, etc.
  11. The better investment will always be something you can control, vs something you cannot.
The last one is nrilliant! Thank you so much MJ! And other's advices is so interesting to read! Thank you community!
 
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BizyDad

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I only skimmed the replies, lots of good tips, here's one I don't think was brought up.

Watch who has access to your money.

When I was a banker, employee theft / embezzlement was one of the top ways that business owners lost money. It can be as varied as skimming a little off the top consistently over time, or just pulling out a bunch of cash and running off to who knows where. So be careful who you give account access to.

Having been on that side of it and seen just how many weird things can come up where a bank won't back you up, I also keep accounts at multiple banks to avoid keeping all my eggs in one basket and I don't link them together.
 
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Boogie

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Having been on that side of it and seen just how many weird things can come up where a bank won't back you up, I also keep accounts at multiple banks to avoid keeping all my eggs in one basket and I don't link them together.

Same with brokerages. Multiple brokerages and nothing linked into the accounts.
 

Rabby

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If you can't afford to pile the money in your front yard and light it on fire, don't put it at risk. Sometimes that's what happens, more or less. Sounds overly conservative or dramatic until you think about the implications... what it implies is that your source of investment money (and other money) should be stable and easily replace the flambéd investment.

Another one is don't risk money with people who don't have a similar amount at risk. The exception being, maybe, if they were silent partners or otherwise had no effect on outcomes, and no responsibilities. I've talked myself out of this rule a few times, and it is always a bad idea. If the risks are all on your side, average people will watch the building burn, and cook hotdogs in the flames. They only care if the consequences fall to them.

Lots of flame analogies. Oh my.
 

Rabby

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I only skimmed the replies, lots of good tips, here's one I don't think was brought up.

Watch who has access to your money.

When I was a banker, employee theft / embezzlement was one of the top ways that business owners lost money. It can be as varied as skimming a little off the top consistently over time, or just pulling out a bunch of cash and running off to who knows where. So be careful who you give account access to.

Having been on that side of it and seen just how many weird things can come up where a bank won't back you up, I also keep accounts at multiple banks to avoid keeping all my eggs in one basket and I don't link them together.
This is a good point. I have rules for embezzlement too. Among them:
  • Everyone takes vacation.
  • A person who handles checks doesn't check the mail.
  • Nobody signs for me, or anyone else.
  • Enforce separation of concerns.
 
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WJK

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This is a good point. I have rules for embezzlement too. Among them:
  • Everyone takes vacation.
  • A person who handles checks doesn't check the mail.
  • Nobody signs for me, or anyone else.
  • Enforce separation of concerns.
I still take the time to collect my rents; do my banking; keep my own books; write & sign my checks; buy my building materials for my projects; manage & check my construction jobs...

Almost every time I've been cheated in the past was because I hired someone do one of those jobs. Am I paranoid? Maybe. Is it a pain in the ##ss? Sure. It has a real up side. I keep on top of things and NO ONE has their fingers in my cookie jar.
 

Rabby

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I still take the time to collect my rents; do my banking; keep my own books; write & sign my checks; buy my building materials for my projects; manage & check my construction jobs...

Almost every time I've been cheated in the past was because I hired someone do one of those jobs. Am I paranoid? Maybe. Is it a pain in the ##ss? Sure. It has a real up side. I keep on top of things and NO ONE has their fingers in my cookie jar.
Same. There are things I delegate for practicality (accepting payments at a location, shipping products, etc.), but not without having 100% visibility and either me or my wife looking over the transactions and balancing everything. As soon as you get lazy about that, embezzlers will be sucked in like iron filings to a magnet.
 

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