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Getting Rich vs. Staying Rich

Getting Rich Vs Staying Rich

Getting Rich Vs Staying Rich

The economy follows a cyclic path, with a different set of dynamics for getting rich, and for staying rich.

Nothing stays the same, and change is the only constant, with the very forces that cause things to go in a certain direction also planting the seeds to push them in the opposite direction.

In economic terms, the cycle goes like this: Recessions cause sentiments to go down, causing underproduction, which leads to scarcity, sowing the seeds for growth.

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Getting Rich vs. Staying Rich

Getting Rich vs. Staying Rich

https://www.collaborativefund.com/blog/getting-rich-vs-staying-rich/

collaborativefund.com

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Key Ideas

Getting Rich Vs Staying Rich

The economy follows a cyclic path, with a different set of dynamics for getting rich, and for staying rich.

Nothing stays the same, and change is the only constant, with the very forces that cause things to go in a certain direction also planting the seeds to push them in the opposite direction.

In economic terms, the cycle goes like this: Recessions cause sentiments to go down, causing underproduction, which leads to scarcity, sowing the seeds for growth.

Humility And Fear

  • Being successful narrows our vision, making us rigid and averse towards change. The people who feel invincible and 'bullet-proof' after getting rich, usually do not stay rich.
  • Humility, coupled with a healthy dose of fear, keeps us on our toes and prevents us from being complacent.
  • Being open to change can make one's shift its business model, and pivot towards even greater success

Example: Netflix was a DVD rental service before pivoting into the world's biggest content streamer.

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In the world of investing, having gone through a traumatic experience first-hand makes the difference between a cautious investor and a blind one. The scarred investor cannot think in the way the fresher, who hasn’t experienced the turmoil can. 

Our unique experiences impact our vision in ways we cannot comprehend on the surface.

Learning From The Past

Different generations have different investment risk appetites, with the younger generation wanting to take bigger risks and going into uncharted waters without any experience.

The New Generation, who hasn’t experienced turmoil and loss, are good at getting rich. However, the older, scarred generation is good at staying rich due to their general pessimism and conservatism. There is a need to balance the two aspects while taking an investment decision. People with different experiences aren’t necessarily smarter than others but just have a different worldview.

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You have no control over things like the place you were born, your biological sex, the situation of your family or your skin color. These things will obviously impact your life in major ways.

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Adopt a Bias Towards Action

Most people's approach to work motivation goes like this: they wait to be inspired, then they get to work.

But successful people don’t sit around and wait for inspiration. They just show up and get to work.

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