It is extremely important that you determine for yourself who exactly is going to take care of you financially in the future. Think about all the people you can possibly rely on, and then ask yourself if you are absolutely sure that you could depend on them.
If the answer you have arrived at is not "YOU," you haven't discovered the correct answer. Think harder. Start all over again. It is imperative that you determine absolutely the correct answer.
So, who can you count on?
It's "YOU" and only you. Hopefully, you have just convinced yourself that it is absolutely your own responsibility to take care of yourself. It doesn't matter what happens to social security or how long you live, if you develop a plan and are absolutely determined to stick to that plan over time, then you can become financially independent.
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To accumulate wealth, there are four principles to consider:
Start investing as early as possible.
The earlier you begin investing, the greater the likelihood of you accumulating wealth. Why? It takes significantly less money to accomplish what you want when you have more time working for you.
Reach for the highest rate of return you believe you can safely receive on your money over time.
When you look for a place to invest your money, why would you want to put your money in a so-called "safe place?" Wouldn't you want to achieve the highest rate of return you believe you could safely receive? Each additional percent is important. The higher the rate, the less money it takes to accomplish what you want.
Save on a regular basis
An easy way to accumulate wealth is to save and invest on a regular basis. The more frequently you save, the faster your balance will grow. Not only that, but investing on a regular basis also helps smooth out the highs and lows associated with a fluctuating market.
Begin investing with the largest possible sum you can afford.
Can you think of a reason not to invest the largest possible sum you can afford? If you are serious about accumulating wealth, you should consider your first investment among the most important. By starting with a large initial investment, you will have more money working for you over a longer period of time.
If you are young, you may want to live a full life in a hurry. You might want all the trappings of the good life before you have really established yourself. Indeed, many of us are ready for retirement with the sound of the opening gun.
Delaying what you want now in order to achieve financial independence in the future may not seem like much fun, but think about these questions:
If you have to be poor, would you rather be poor now or at retirement? Do you want to try to control your own destiny rather than be controlled by circumstances? Can you commit yourself to putting order into your life so that you can accomplish your goals?
You can become financially independent - but do you have the determination to achieve your goals?
Unfortunately, you can't have everything. You must decide what you want the most and then make plans to acquire it.
About the Author: James E. Stowers is founder of American Century Investments, a multi-disciplined, global asset management firm offering diverse investment vehicles. He is also the author of the award winning book "Yes, You Can... Achieve Financial Independence<>which includes the Stowers Financial Analysis CD-ROM.
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