I Got RICH When I Stopped Doing These 8 Things

This coming recession is your opportunity to get rich. Well, that’s what all the YouTubers seem to be saying. You need to get rich. And you need to get rich quick. So, let’s talk about how you can win while others are losing. The opportunity that is at our feet as I’m writing this article is absolutely insane. So, by being aware of the following eight traps, you’ll be able to make much better choices with your money.

Money Trap 1: Being Scared to Take Risks

Balancing Risk and Ambition

Being scared of risky opportunities is understandable in such uncertain times. As an investor and a businessman, my job is always to minimize risk. Risk might sound sexy, but taking too much on is not a smart move. I say this, but even when you’ve done everything in your power to minimize risk, there is still going to be some in every opportunity. Otherwise, everyone would be doing it, and we all know the cliché saying that when something is too good to be true, it probably is.

If you’re lucky enough to be between the ages of 20 and 50, then you’re at a huge tipping point in your life. The decisions you make in this 30-year window will cause huge ripples that affect your loved ones like your parents, grandparents, partner, and kids, be that positively or negatively. To put it simply, this time period could make or break your financial future.

So, when an opportunity that could completely change your life presents itself, will you be paralyzed due to the recession, or will you objectively analyze the risk and act not out of fear, but ambition? Many millionaires say one of their five biggest regrets was not being bolder. The thought of what could have been eats away at you if you don’t take that small leap of faith.

Money Trap 2: Investing in Things You Don’t Understand

The Number One Rule of Investing

This is the number one rule of investing. It is extremely true, but every time a crisis happens, people totally ignore it. It’s great there’s so much information being shared online now. The rich are finally giving out their secrets and people are listening. However, it is important to be careful about what advice you act on. If you don’t completely understand an investment opportunity, stay away from it until you do.

I get lots of messages asking me my advice about stocks, cryptocurrency, and real estate. It’s obvious that some of these people have just watched a 10-minute video on the subject and are ready to put all their hard-earned money into something that they don’t fully understand. Like I said before, risk is good, but it’s your job to minimize that risk by doing as much research as possible. You should never just take advice from one person on the internet, as everyone has different opinions on investment opportunities. It’s best to pull lots of opinions together so that you’re able to make a more informed decision.

Learning from Experience

Many years ago when I was in my early 20s, I nearly put a big chunk of money into an investment group. Everything they touched seemed to turn to gold. And I didn’t really understand how they were doing it, so I passed on the opportunity. Had I invested $50,000, a year later, I would have lost over $300,000 because they were leveraging every investment by six times. It’s a good lesson to learn though, because I would have previously thought the amount I invested would have been the maximum I could lose. I had yet to discover the perils of margin trading, and I’m glad it didn’t cost me 300K to learn that lesson. Luckily now there are apps like public.com where you can interact with a community of investors and learn together. They also give you a free stock worth up to $1,000 when you sign up. I’ll leave that link in the description below.

Money Trap 3: Not Spending Enough

The Cost of Cheap Quality

This may sound a bit strange, “not spending enough”. I thought you were meant to spend less and invest more, isn’t that the idea? Well, you would have thought so. The thing is, if you don’t spend enough money on good quality products, then it could actually end up costing you more money. Being frugal with your money in some situations isn’t a bad thing, like not spending too much on takeaways or shopping around for the best grocery deals. However, if people start trying to cut costs on everything, then it could be pretty dangerous.

Let’s say you have to take your car in for a repair. If you go to the cheapest car repair shop, then you might be lucky enough to get a good service. However, it’s more likely that you aren’t going to get a quality job done, as they can’t afford to take the time to look after your car carefully. They may cut corners and miss something, or even lie about fixing the issue. This means it’s not going to be long before your car has problems again, and you’ll have to go back and get it repaired properly. You might as well have spent the extra money now, which will save you money in the future. And of course, that’s the best-case scenario. What if the car is still dangerous and it causes you to have an accident?

The Value of Supporting Quality

There are many things like a car repair that it’s best to pay a little bit more for, to be on the safe side. Buying quality products and services also helps support the people that are offering them. If no one buys these quality services, then they won’t be there when we need them.

Money Trap 4: Taking Your Job for Granted

The Importance of a Steady Income

With more people than ever losing their jobs and businesses going bankrupt, it’s really not the time for people to take their job for granted. If you have a steady job, then you are in a better position than a lot of people at the moment. And you should do everything in your power to keep it that way. If you want the ability to invest, then having a strong income source such as a job is imperative.

Not everything is under our control. However, when a business is in trouble, they often have to make some tough choices about who to fire first. When the people in my team go the extra mile in a time like this, it doesn’t go unnoticed. If someone makes themselves indispensable to a business, then they’re going to be the ones holding on to their jobs longer than anyone else.

Avoid Quiet Quitting

I’ve noticed a trend going around on TikTok called “silently quitting”. The basic idea is to do just the bare minimum at your job. I couldn’t disagree more with this mentality. It’s important to remember that everyone is in the same boat, and ideally, an employer would love to save everyone’s jobs. In order for this to happen, then the business needs to be performing to the best of its ability.

One of my past members of staff would moan and complain about everything. It brought the whole team down. Then he decided to leave because he was offered a job with a higher salary and more perks. As he left, I remember him saying, “You’ll be begging for me to come back”. He lasted less than a month at his new job, as he couldn’t hit the targets. He also hated the traveling and the long hours. I’m not saying he begged for his job back, but he did ask. And as you can imagine, there was no position for someone that just does the bare minimum.

There’s an old saying that the grass is always greener on the other side. This is rarely the case.

Money Trap 5: Payday Loans

Predators in a Crisis

Payday loan companies are like predators during these times. They see people are struggling, and they advertise to them non-stop. Every time they open Facebook, every time they look at a billboard, every time they read a newspaper, “get paid now quick and easy, pay us back later”. Although a lot of people have become aware of this money trap, there are still lots that would consider taking out a payday loan and paying it back later.

Long-Term Damage

This is one of the worst things someone can do, as it has the potential to totally destroy your credit score, which could mean that buying a house or a car in the future could be a big challenge. The interest rates on loans like these are sky-high, so you end up paying back way more than you actually borrowed. By simply tracking your spending, you can avoid being in a situation where these predatory companies can take advantage of you.

Money Trap 6: Not Having a Side Hustle

Building a Stronger Foundation

Although you shouldn’t be taking your job for granted, it also shouldn’t be your only way of generating income. Think of a job as the foundation of your life. If you’re balancing everything on one foundation, when an earthquake hits, such as a recession, your whole life is going to crumble away. By having a side hustle, you create another stream of income that strengthens the foundations of your life. Now if you lose your main job, you still have a source of income to pay your bills, and it can prevent you from falling into bad debt.

Hustling During Hard Times

My early jobs only just paid enough to keep my head above water, so I always had a few side jobs. One that was great was teaching people to fly model helicopters. I developed a skill that many struggle to master, and I charged to pass on this skill. The extra money I earned covered all my normal expenses, so then I had the ability to invest all of my salary into starting my own business.

It might seem impossible to start a side hustle when we’re going into a recession. But if you look hard enough, there are online industries that are booming, such as selling digital products and affiliate marketing. People have the tendency to turn to entertainment in hard times, like Netflix, for example, and therefore don’t bother putting in the extra effort after they finish their day’s work. But this is the time to double down and hustle as much as possible.

Money Trap 7: Not Living Within Your Means

The Dangers of Lifestyle Creep

People have got used to the good times, and many are spending more money than they actually have. You’ve seen the people buying expensive cars that you know they could never afford with their income alone. People are racking up the credit card bills like there is no tomorrow. This isn’t a good idea in the best of times, but it is especially important to live within your means or even below them when the economy is slowing.

By creating a budget and cutting out all the unnecessary spending, you’re able to invest more and focus on what really matters to you. After all, is getting the next car, the latest clothes, and the most fancy house really worth it if you end up having to give up your future hopes and dreams?

Money Trap 8: Get-Rich-Quick Schemes

The Clever Marketers

This is something I had to mention as I’m seeing it more and more. Clever marketers are selling online courses that promise big things. More often than not, the only people getting rich are the ones running the scheme. There is usually nothing wrong with what they’re teaching. Amazon FBA, drop shipping, and affiliate marketing, they’re all real businesses that have the potential to make you some money, but they market towards people without any experience. They sell a dream that anyone can become rich if they follow their simple formula. You have to ask yourself, if it was that easy, why aren’t they doing it themselves?

Missing the Effort Required

They basically package a legitimate business idea in a way that looks attractive to the everyday person, but fail to mention that their success rate is near rock bottom. So, whenever you see an ad from some guy standing in front of a Lamborghini, promising you the world on a silver platter, it’s probably a good idea to be a bit skeptical and do your own research.