Book of Wise Investors

Most of the millionaires stories heard about centered on people starting their own businesses and luckily strike the jackpots within the first few try. Does that mean that you cannot be a millionaire if you are slogging your way out as an employee?

The fact is and the good news are that you can build a relatively large nest egg in shorter time even if working for paycheck to paycheck. Who knows? You may even achieve financial freedom earlier.

1. Principle of Incremental Improvements

The idea is to make yourself outstanding as a prime candidate for year end bonus, promotions and subsequently pay raise.

As such, streamlining current way of doing things, finds ways to cut costs for company, sucking up to bosses, suck cock for bosses, create new revenue streams for company etc, helps in increasing your monthly paycheck.

2. Negotiating for higher pay from superiors

Negotiating for higher pay is not going to the boss and demand in a loud voice that you want a pay raise because you deserve it.

It is talking in a nice and persuasive and reasonable way about your desire for pay increases.

Of course, you have to show results and put in right effort in your work.

The good news is that Carnegie Mellon economics professor Linda Babcock found that those who negotiated their first salary boosted their pay by 7.4% compared with those who didn’t bargain.

3. Quantify how much value you add to your company

Despite how much time and effort you put into your work, the only thing that matters is the amount of value that you eventually add to the company.

An office cleaner also puts in effort to keep the office clean. Why is it that her salary is usually the lowest among the all the employees?

If you are an engineer, show clearly on PowerPoint sildes when presenting to management the amount saved or earned by the company annually as a result of your innovations.

If you are a manager, also show clearly the money involved that arises from your managerial actions.

4. Move on when better opportunities present themselves.

It has been said that if someone don’t appreciates you, find another one.

If present employer does not seems to offer you a better future, then find another one.

But first you need to create a professional looking CV on LinkedIn or MySpace to tell prospective employers why you deserved the job more than others.

Extract Maximum Benefits From Uncle Sam

5. Contribute to 401(K) and other tax deferred retirement plans

This is like killing 2 birds with 1 stone. What is better than to save more for retirement and reducing taxes at the same time.

For Federal tax bracket, every $1000 into 401(K) reduces taxes by $250.

6. Why pay more for medical expenses

Diseases and illness is almost a guaranteed event to happen given the food we eat and the environment we live in.

As a result, the probability of getting back some “value” back from health insurance is also almost a guarantee and having a comprehensive and optimal health insurance coverage is a must to prevent paying more for medical bills out of your own pockets.

Let your money work for you

7. Time + Compound Interest = Wise Wealth

The earlier you start investing, the less money you need to set aside each month to get you the exclusive $1 million by age 65.

This is the magic of compound interest, you have heard this before.

Simply by starting early, you can still have the same standard of living and yet does not compromise future retirement needs. This is because the same final amount can be achieved by smaller investing amounts if you simply start early.

The most powerful force in the universe is compound interest

from Albert Einstein

8. Automation in Investing

Automation in manufacturing improves product quality because most of the times a machine does a better job than a human.

Automation in investing improves investment result simply because you are a busy working professional and may buy too much equities when the prices are high and not buying any when the prices are low which is now.

9. Shoe Leather Costs In Investing

Any purchases of financial products usually involve some transaction costs.

Whether you buy into mutual funds, unit trusts, hedge funds or direct ownerships of individual stocks yourself. Take note that whenever you buy and sell, there are fees involve that may eat in substantially into your returns.

10. KISS – Keep it simple stupid

It makes much better sense that as an employee, to expend more time and mental effort in your work and field so that higher productivity and more value is created for the company.

Things like get rich quick schemes, Sunshine Empire, sales pitch for complex investments. Forget about it and just invest regularly in a balanced portfolio and accumulate your wealth over decades.

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