Bill Gates, Warren Buffet, Roman Abramovich and Michael Bloomberg are just some of the world’s top self-made billionaires. Listening to them sharing their ‘rags to riches’ stories on various media platforms is enough to call them investment geniuses. Even if you are not keen on making a lot of money, there is no doubt you will learn one or two things about investing from these incredibly resilient people.
But two is way too little, because we have a lot to learn from them. Thus, here are ten investment lessons from self-made billionaires.
See Also: Top 10 Habits that Make You Rich
1. Begin Early
If you want to be rich, then you have to start investing as early in life as possible. Warren Buffet, the second richest person in the world as of 2015, made his first investment when he was 11. And he never looked back.
2. Invest in Companies You Understand
Buffet has not invested in Facebook, even though it has a network of over $200 billion, about 100 times more than his own company, Berkshire Hathaway ($2.5 billion). Why? He doesn’t understand its business model. The lesson here is you should put your money in companies whose business activities you understand.
Don’t put all your eggs in one basket. So goes the classic wise saying. You definitely don’t want to invest your hard-earned money in one company or industry. Spread your wealth across several markets. Roman Abramovich, for instance, doesn’t only purchase soccer clubs. He has also invested in electronics, plastics and energy.
4. Respect Financial Services Professionals
According to Warren Buffet, Wall Street is the only place where people drive to in a Rolls Royce to get advice from people who take the subway. To be an accomplished investor, you must trust and respect your army of investment or financial advisors. You may have the money, but they possess the market knowledge that can help double it.
5. When Markets Fail…
As an investor, you must be prepared for all possible outcomes. When market conditions are not good and prices are down, don’t get emotional over the losses you will incur. Instead, see it as an opportunity to buy.
6. Invest in Your Education
Well, Bill Gates, Larry Elisson, Mark Zuckerberg, and a few other billionaires are college dropouts. But they didn’t drop out without purpose. They had billion-dollar ideas. On the other hand, Buffet and many others billionaires are college graduates. Invest in your own education so you can understand more about money, business and other fields.
7. Understand Tax Regulations
Even the super-rich want to avoid taxes. As you make hefty investments, know that they are also accompanied by hefty tax bills. According to Michael Bloomberg, it may be financially sound to avoid investments that will be heavily taxed.
8. It Is Never Too Late to Invest
If you think you are too old to invest, think again. Sure, you don’t have to be 11. Whether you are 30, 40 or 90, you can always let your money work for you by investing in profitable ventures.
9. It Is All Hard Work and No Play
You know only too well that billionaires are associated with the finer things in life: private jets, yachts… pretty much everything money can buy. That is okay, but Warren Buffet would rather spend his free time reading financial statements than go dancing on the beach! To keep making money, you must work hard and stay focused.
10. Invest in Philanthropy
Show me a famous self-made billionaire who is not a philanthropist and I will show you, well, a yellow sky! As you find success, dedicate yourself to charitable causes. Start a foundation and do something good like helping the poor or funding health research projects.
Are you looking to invest? No doubt you have been served a dose of investment lessons that can steer you to vast wealth! Apply them keenly.