secret to get rich business

Want to get Rich? Here’s How the Rich Do It.

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Want to get rich? Invest in your own business ideas instead of stocks and bonds.

Ask someone how to get rich and most will reply with investing in stocks or following the stock-picking advice of gurus like Warren Buffett.

Most people are wrong!

What’s the real story?

A survey of more than 2,500 wealthy people around the world found some interesting ideas about how the rich invest their own money.

The survey calls into question the traditional notion that stocks are the way to go to build a big money fortune. It also points to the solution.

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Rich People Get Rich by Investing in Businesses

Scorpio Partnership and BNP Wealth Management asked wealthy individuals in 17 countries where they put their investments. The average respondent to the survey had an average net worth of $7.6 million.

On average, the wealthy had just 17% in stocks and 21% in bonds. That’s only about a third of their wealth in the financial assets that we’re all told we must have to reach our investing goals.

So where do rich people invest? In themselves and their own businesses!

The table shows only 25% invested in their own business but much of the money in alternative investments and startup financing is represented by new businesses as well. That’s up to 43% of their total wealth in privately-owned businesses.

Rich people also hold a lot of cash, probably to help cover unexpected business needs. Most individual investors may not need almost 20% of our net worth in cash.

The Truth about Investing in Stocks

As an investment analyst for nearly a decade, I am all about investing in stocks but they are not going to make you rich.

That doesn’t mean you shouldn’t invest in stocks and bonds. They are an important part of a long-term wealth strategy but are really just glorified savings accounts. At about a 7% annual return, your earnings are not going to be higher than regular deposits for nearly 20 years.

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While the annualized return over the last few decades on investments has hovered around 7% for stocks and almost 5% for bonds, there’s reason to believe that returns going forward may not be as high and they surely aren’t going to make you rich.

The Secret Lesson on How to Get Rich

The lesson is that if you want to become rich, you’re going to need to take a chance and invest in your own business. That doesn’t mean you need to sink all your money into building the next Tesla Motors. For most people, it means finding simple business ideas that you can start in your spare time and then build to a full-time gig.

I’ve made money on five of the work from home strategies in this Directory of How to Make Money.

secret to get rich businessWork from Home Income – Last Six Months through July:

  • Self-Publishing $8,629
  • Blogging $5,840
  • Freelancing $25,750

Each of these business ideas can be started with as little as five hours a week and it’s easier than you think. In fact, tens of thousands of new blogs are started every day and self-publishers are now making a fifth of the total earnings on Amazon Kindle.

I may only make a thousand or two from each business idea each month but it’s only been a couple of years since starting the blogs and self-publishing. I know other bloggers that make five-figures a month on their websites and have only been at it for a few more years than I.

The beauty of starting a blog as a business is that it costs almost nothing, as little as a couple hundred dollars for web hosting and other resources.

Again, I’m not saying you should stop investing. Even investing $1,000 each year in these three ideas can grow to over $100,000 in 30 years. I wouldn’t call it rich but it will provide a more stable nest egg compared to business income.

The point is that you shouldn’t rely on stocks or bonds if you want to be rich. It’s just not going to happen. Trying to get rich off stocks means you’ll be tempted into penny stocks or other high-risk investments that will only end up losing your money. Invest like the rich and put money in a business that will make money and give you the financial independence you deserve.

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