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I was asked to write a guest post for fivecentnickel.com that will be posted while nickel is on vacation. I decided to base my post on the timeless advice of Warren Buffett and some of his most notable quotes. As I was researching the post I could not help but notice a trend in Buffett’s quotes: growing money takes time and patience.
Most will say they are patient, but with the wild swings of the financial markets and the emotional reactions it is easy to see that most of us are letting this advice fall on deaf ears. Truth is that many enjoy the rewards of investing, but become very unsettled when the market becomes volatile.
On today’s show I provide a few of Warren Buffett’s quotes that focus on the value of long-term investing and patience. Remember time is your friend when it comes to making it through uncertain markets.
Here is an example of a Warren Buffett quote that I use in today’s show, “Someone’s sitting in the shade today because someone planted a tree a long time ago.”. What a visual that quote generates! That quote is a perfect representation of what your mindset has to be in order to generate true financial independence.
A few key stats that I reference in today’s show:
Assuming a 10% rate of return you would need to save the following amounts monthly to accumulate $1,000,000 by Age 65…..
The Advantage of Starting Early:
Two friends graduate from college together. One decides that they will start saving immediately, but for only 9 years. The other friend decides that they are going to live for the day and put off saving for 9 years, but once they start they are going to be consistent until the day they retire (35 years). So who will have more money at retirement the friend that invest $18,000 right out of college or the consistent but delayed friend that invests $70,000?
Assuming a 9% rate of return you are going to be shocked by the results…. (listen to the show for the results!)
A Discussion on Unsuitable Insurance:
I close out the show by discussing a phone call I received a few weeks ago from someone who had been sold a bad insurance product that did not fit their financial needs or goals. Please do not think that I am picking on insurance companies because one look at my personal financial profile and you will quickly realize that I use quite a bit of insurance to protect my family. There are plenty of good insurance agents, but there are also those that do not try to understand the needs of their prospects because it is all about the transaction. Listen to the situation that I describe in today’s show, and hopefully you can learn how to spot a good agent from a bad agent. For all of my good insurance agent listeners … I know how this story makes you feel. Believe me there are plenty of bad financial planners out there as well, and because of the bad apples it takes a lot longer to build trust with clients.
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