By Craig Erwin, Ph.D.
Investing is not a get-rich-quick endeavor. Successful investors tend to accumulate wealth over decades, not a few days or months. Investor’s Business Daily (IBD) notes that Millennials and Gen Z are the group most enthusiastic about cryptocurrency because they think it will make them rich overnight.
Undoubtedly many people have lost faith as cryptocurrencies have suffered sharp losses this year. Bankless Times reports that over three-quarters of Americans lack confidence in cryptocurrency. Bankless Times notes that many cryptocurrency holders became disillusioned, confronted with the reality that their crypto holdings could become worthless in a flash. Still, IBD notes that Millennials and Gen Z remain faithful to crypto. But are they crazy or are they geniuses?
Buying cryptocurrency is not the only way people have believed could make them rich overnight. People have tried flipping houses, buying lottery tickets, and gambling on sports and horses and many other things. But how many people do you know who have gotten rich doing this.
Tried and true investing techniques are still the best ways to accumulate wealth. Although they are boring and they don’t amass wealth overnight, they have a much greater chance of being successful. Save something every week or every paycheck and invest it in the stock market letting your holdings sit for decades. That is the way many people have accumulated enough wealth to retire comfortably.
If you invest in the stock market, the amount of wealth you accumulate is most dependent on how much you save, not on how clever you are at picking stocks. In fact, the cleverer you try to be, the poorer your performance is likely to be.
If you buy cryptocurrency to accumulate wealth, what determines how much wealth you accumulate? God only knows. The easiest way to end up with $1,000,000 is to start with $2,000,000 and lose half of it. For many of us, buying cryptocurrency may be an excellent way to do just that.
So, don’t be foolish. Getting rich quickly is highly unlikely no matter what method you use. Stick with tried-and-true methods like accumulating wealth gradually over decades by buying stock month after month after month. Getting rich quickly would be great, but it is highly unlikely. Getting rich slowly is infinitely better than never getting rich at all.
What are you investing in? How is your portfolio’s performance? What do you wish you had done differently?
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