Wealth in Practice: 22 Principles We've Tested!
Bodo Schaefer is another legend in the financial world, a writer and businessman, the No. 1 financial consultant in Europe, who had nothing but debts at 26 and became a millionaire at 30. In Germany, Schaefer's homeland, he is called "the financial Mozart" after he said in an interview: "Notes were known before Mozart. What matters is what he created for humanity out of them."
Bodo Schaefer's books and seminars have become the starting point for many people who have achieved significant success in business. Perhaps Schaefer's 22 principles will be the beginning of financial success and independence for you.
FORTRADER magazine experts have tested these rules on themselves and can say with full responsibility, they work. If you focus on them to the fullest, you will have enough money for absolutely everything and will even have some left over 🙂
Principle No. 1: Save and invest
You should set aside in a separate account 10-25% from your regular income and 50% from excess income. You must be sure to set aside invest (in stocks, gold, real estate, vacations or education). Since interest from bank deposits is insignificant and, at best, will only preserve your savings from inflation, find a worthy use for it. Take a responsible approach to this issue.
If you are not yet up to stocks, and buying real estate seems like a pipe dream, go to advanced training courses, learn English, etc. Invest in yourself!
Principle #2. Reasonable economy
Wastefulness and a luxurious lifestyle beyond your means are unlikely to contribute to your financial growth. Reasonable savings and constant stable investments are the way to a million-dollar fortune. Learn to enjoy life without excesses, it is not as difficult as it seems.
Principle #3. Attitude towards money
A lot of people simply have a bad attitude towards money. And money should be loved! Moreover, love not to spend it, but love to treat it wisely. However, you should not resort to extremes and asceticism.
Principle #4. Financial planning
You will need to define your goals and aspirations, as well as the ways to achieve them. A financial plan will help you in this, which you should make for a long period of time step by step: spending for a week, for a month, for a year, for 2-3-5-10 years.
Of course, it makes no sense to prescribe the purchase of bread for 10 years, it will be grocery expenses, which you will reflect in the expenses for each day. But the purchase of an apartment or a car should be written in your long-range plans, and at the same time to calculate how much you need to start saving today and what you should strive for tomorrow to realize your ideas with ease.
Principle #5. Don't be petty in your dreams
Don't be petty in your dreams, they should be global! Think of a billion-dollar fortune, achieving high positions in your career and solid financial success. Break down a big goal into several smaller goals. Achieve each local goal step by step, which will be stepping stones to achieving your big dream.
Napoleonic plans will help you move quickly in your career and see results. It will be difficult, but with a plan you will succeed. Even if you don't reach a billion-dollar fortune, at the halfway point your results will be well above average.
Principle #6. Think right!
In order to become a millionaire, you need to think like a millionaire. Adopt the way of thinking of rich people. To do this, you can read the memoirs of billionaires or find a collection of such ideas put in separate articles.
Anyway, to become someone, you have to find someone to emulate so you don't reinvent the wheel. It always works!
Principle #7. You need to be confident in yourself
Money does not like insecure people. Believe in yourself, follow your own principles and ideas. Do not give up, even when things do not go smoothly, believe in your success.
When we started making our fortrader magazine, we worked for a whole year only on altruistic principles, without finding the necessary amount of support from advertisers. But we really believed in our idea that such a resource would be interesting to traders and would be useful, and we didn't give up! Now we are almost 8 years old, our staff has expanded to 20 people and we are very happy that we were patient during that long year.
Principle #8. Don't run away from problems
Achieving big goals is always fraught with difficulties and challenges. There is no need to be afraid of them. Think of them as a stepping stone that you overcome to get closer to your goal. By solving a problem, you gain experience and become stronger.
Principle #9. Do not despair
No matter how bad things get, never despair or lose your temper. No crisis should affect your determination to achieve your goals. Often in our grandiose plans we do not find support from those around us who are used to thinking in a formulaic way. 50% billionaires started their careers from the lowest positions, but they went to their goal by all means, step by step every day. Keep going!
Principle #10. Set reasonable limits for yourself
You cannot achieve financial prosperity without limiting yourself and planning your spending. The path to financial freedom lies through them. Boring and unpleasant, of course, but very necessary.
Discipline is a step towards your first million!
Principle #11. Be decisive
Decide - do it! If you don't start implementing your decision within three days - rest assured, with a probability of 85%, you will never start implementing it. So start now. No, really, right now.
Take a piece of paper and a pen and write about your financial dream. Now for the very first thing you need to do. Break your plan down into action steps and start executing it today. This is important!
"Learn to enjoy life without excess" - well said, but hard to execute.
By excesses I meant a golden toilet and 5 cars in the garage - for Monday, Tuesday, Wednesday, etc. For example, if a wife needs a multicooker to cook delicious, healthy and varied for the family, she can do with a frying pan, which is 20 times cheaper, but how much time will she free up for her development and family? Functional assistants are not an excess. Neither are expensive clothes - they last longer. 8 pairs of shoes is overkill, 2-3 are a necessity. Don't go into asceticism.
In order to think about excesses one can try to understand the true function of things, for example clothes - to warm the body and protect it from the cold (but no one says that they should go in tatters, simple clothes can also look quite neat), a car - for transportation (but no one says that it should be a wreck that spoils the air and prevents everyone from living), etc.
At first glance, such simple recommendations. However, how difficult it is to put them into practice. And all because of your own inability to think straight.
All the troubles in our lives come from the mind and the great desire to have everything at once. When you start to live by such rules, think about purchases and the need to make them, a lot of needs quickly fall away for uselessness. Sometimes I go to the store and in a feminine way I'm like, "Oh, I want that blouse over there...!" And then I ask myself: "Why do I need it?", when the answer is something like "because it has flowers, I don't have any flowers", then the desire to buy it quickly disappears 🙂 🙂 .
I agree that many people don't need excesses at all. You need to know the value of money and understand what exactly you need to be happy. There is no need to chase super-profits.
That is the problem that the advice is very simple, but effective, but to achieve great results requires not only labor, but also a fair share of luck.
This one is definitely for you 🙂 🙂
There was once an unlucky and unlucky man. He said that he was pathologically unlucky in everything - he couldn't even win a penny in the lottery, but he was unlucky, that's all!
So the man began to ask God for help. Every night before going to bed he prayed and asked to win a million dollars in the lottery. He asked for a month, a second, a third, a year, two, three... And still no help!
Suddenly a voice from heaven says, "Well, you should at least buy a lottery ticket!"
Sound recommendations. The idea of planning one's spending for the long term and ways to share monetary savings to achieve goals is especially well expressed. There is something to adopt into your principles of achieving financial well-being.
Some years ago, it was Bodo Schaefer's books that led me to the stock market. I especially like "A Dog Called Mani". It is a children's book, but it is not a bad thing for adults to read. Schaefer has a talent for writing about complex things in simple language. I agree with him in many ways. I did some things before reading his books. By the way, as far as I remember, Schaefer does not consider vacation an investment. And he does not recommend spending money on vacation until there is no protective capital. But investments in stocks using his method turned out to be unprofitable for me. It was good that I tried trading virtually at that time. But it was probably not Bodo Schaefer's fault, but my inexperience.
Investing in vacations is a departure from Schaefer's concept in my experience. Let me explain why. Sometimes you can work hard for a year or two, beat on a problem, look for ways to make money. The brain is a resource like land, for example. If you plant potatoes in the same place 5 years in a row, the harvest will be reduced many times over. Similarly with the brain, concentrating on the problem, we stop thinking broadly, miss important things due to fatigue, lose concentration and grip, so I strongly recommend to ventilate 1 day a week, do not touch work at all, and take a vacation for 7-10 days at least once a year. Even a simple trip to another city can give you the right idea. And it would be good to get enough sleep if possible.
I fully support Yulia in this matter! I've checked myself - all the most interesting ideas for the site, articles and solutions for trading strategies came to me during my vacation. That's how our brain works... You struggle and struggle over some problem, but the solution does not come. But it is only necessary to abstract from the problem and give yourself a rest after brainstorming, as bang... A spark of clarification and as a result - a clear vision of the solution to the problem! So, guys, give yourself a rest, do not forget about your loved ones, love life and those around you. You will definitely succeed!
Wo-o-o-o-o-o-o-o-o-o)
Julia, thank you very much for introducing me to Bodo Schaefer. I will definitely read it. And special thanks for adding rest to investing.
Always a pleasure 🙂
There's also a point to be added. He relies only on himself, for others will always fail him.
That's a great point. The article will have a sequel, I'll add it. Thank you!
Only a foolish person will put all the profit into business at once, without considering the probable losses and then there will be no capital.
I agree, the article is very well written, because only positive thinking and regular improvement of financial literacy can achieve to become rich. Only thinking, without working on increasing income or only saving money together with saving money and looking for passive income with a negative attitude will not give results. It is labor, but it is worth it.
I like the principle of global thinking. Think about buying an apartment at once, not 500 pieces of clothing, and you will start to spend money differently, wisely.
All of this is near-dark and unspecific. All these authors write only water - that tested, that works. And I wonder how they made their first million? Of course honestly. But the only thing is that they raised their money when Europe was rising from the ashes. When it was possible to steal somewhere and cheat somewhere. I don't think the site owner should print such informational garbage. There are more useful concepts and things that can really benefit.
Well, fortunately, I am not old enough to earn at the time you write about 🙂 And, by the way, there is nothing in the article about stealing and cheating. We made our magazine from scratch for 8 years, we didn't attract investments, we didn't expect help from anyone, we didn't have anything of our own, except the desire to make forex in Russia more accessible and understandable. There was nowhere to steal 🙂 And there was nothing to steal.
Unfortunately, in Russia there is an entrenched idea that you can only live well if you have stolen something. Maybe it was like that in the 90s, but now it's a different time and everyone can succeed if they want to. You just have to work on yourself.
You won't get far with your opinion, it's best not to think that way.
Interesting recommendations, I especially liked point #6 "Think like a millionaire", but I think that for this, you need to have at least one million, even if not in dollars.
One of the simplest examples: millionaires are always thinking about how to spend their time and resources so that they can make money. To think this way, you don't have to already have a million, you have to replace watching TV with making a plan to earn money, for example.
I always set limits for myself, which is why I always get enough of my paycheck, but that doesn't make me a millionaire. Maybe it's not time yet.
If your salary is not 500,000, it will not make you a millionaire, no matter how much you limit yourself. For such a state, you need to look for other ways to earn money, to plan your way to it. For example, my dad is not rich at all, he works as a simple worker in a factory, but he knows how to competently invest savings in the bank at interest, change rubles to dollars and dollars to rubles, he follows all the changes from the Central Bank every day... Not quickly, for 5-7 years he became a millionaire with the most ordinary salary. He VERY much wanted it! His goal is to supplement his pension, to live on interest. There are all kinds of options, you have to find your own!
We, mere mortals, and so try to save money, rationally use funds, start working from the bottom, do not despair and try to solve problems. But, alas, millionaires and do not become.Not everyone in life is lucky.
Read my response above. Luck is 20% of success, the rest is work!
You can't become a millionaire on savings and rational use of funds alone, you need to comply with all the above points.
The main thing is to be confident in yourself, but at the same time every day to learn something new. And don't be afraid to take risks.
Taking risks, by the way, I'm afraid)) I'm always in favor of very reasonable investments.
Take risks within reason
When advice is given by a successful person, it is worth listening to it. And they are indeed sound, especially the first one about investments.
As it is accurately said "to become a millionaire, you need to think like a millionaire". Then, indeed, new ideas and opportunities will appear over time. The main thing is not to miss the moment!
As it is accurately said, "in order to become a millionaire, you need to think like a millionaire". Then, indeed, new ideas and opportunities will appear over time. The main thing is not to miss the moment!
Financial planning for 10 years and thinking about a billion dollar fortune is a strong word. It is possible to save, invest and save money if you have at least a million dollar fortune. Most of the principles are irrelevant to us, and the most important thing is to never despair!
I am close to the principle of reasonable economy, because the pursuit of a luxurious lifestyle for many people simply dooms them to constant debt in pursuit of it.
Bodo Schaefer is a financial planning guru. After reading his book for children "Money", I put aside at least 15% of income. The rules are simple, but they work.
Discipline is the most important thing for traders in general. It is very difficult to set reasonable limits, especially when dealing with a large flow of money. But without it you will be financially bankrupt. Besides, a trader should always be confident and not be discouraged.
Bodo Schaefer is a smart man whose advice should be heeded. Thank you for the selection.
All cool, advise how else to work normally 14 hours a day and have time for everything else (sleep, rest, food, sex and other delights of life).
In my opinion, working 14 hours a day is no longer normal, hence the lack of time for anything else.
Tips rather banal than shining originality, but how hard it is to follow them! I'm afraid if you stick to such strict rules you will lose the taste for life.
Everything ingenious is simple. There is no point in inventing something if you have to follow the simplest thing. You can lose the taste for life if you have no great desire to change something in yourself.