I feel that not enough people (especially here in Switzerland) have an investing mindset.
A lot of people have high-paying jobs and are leading quite comfortable lives.
Why should they bother investing?
Cash is a bad store of value
Every year, cash is losing purchasing power. It might not feel like much year by year, but over time it adds up. Since 1950 for example, the US Dollar has lost 90% of it’s purchasing power. That’s huge.
Second stream of income
A wise principle is to never depend on a single source of income. When you invest, you build a second stream of income (and/or capital gains).
With that you gain more confidence and more negotiating power. You can feel more secure asking for a pay raise, or even switch jobs.
And if you’re disciplined and patient enough, this second stream could even match or overtake your salary over time.
Getting good at investing will allow you to buy back time. Either go part-time, take a long sabbatical, or retire early.
You don’t have to do this, but it’s always good to have the option to choose.
These are just some of the reasons why it might be worthwhile to build an investing habit.
I’m aware that it’s a skill which takes time and effort to build. But before you start, you need to know why, which is the intention of this article.
Once you have the desire, you will find a way to make it happen.
Book recommendations to get you started:
- Your Money or Your Life by Vicki Robin (audio version)
- I Will Teach You To Be Rich by Ramit Sethi (audio version)
- The Millionaire Next Door by T. Stanley & W. Danko (audio version)