Add sunlight, water and nutrients
I recall vividly a rather baffling conversation during my time in Hong Kong. I was chatting with a fellow adviser and he was telling me about some of the crazy schemes people had been duped into signing up for. One such scheme, called ‘vertical farming’ (think of cabbages, lettuce, broccoli, all stacked upwards, like supermarket shelves, row by row) was guaranteeing returns of 15% per annum for investing in their product. Have the alarm bells started ringing yet? One such investor saw $500,000 wiped out in the space of a few years, with the adviser and the so called scheme no where to the found.
When it comes to investing your hard earned money, there are no guarantees. Let me say that again -there are no guarantees. You should be extremely wary of anyone promoting something that seems a little too good to be too. Of course, we now live in a world where we crave instant gratification. We want to see returns now and our wealth to grow quickly. Who wants to wait after all!
A key lesson we tend to forget on the wealth creation journey is one of the most important and it’ll serve you well the next time you’re presented with a ‘too good to be true option’:
“Investing in the stock market is the get rich slowly scheme”
Anon
As much as we’d like to plant our seed one day and wake up to a giant beanstalk the next, the reality is it doesn’t tend to work like that. As investors, we need to invest in time, patience and discipline.
Plant that tiny little seed into the soil, press it in snuggly below the surface. The process has already begun as our little seedling feeds away on all those delicious nutrients surrounding it in the rich soil. Over time with consistent watering and sunlight basking down on our hopeful little seed, green shoots begin to pop out and up from the soil. It grows ever stronger and taller as the sunshine, water and nutrients continue to build it up….
They do say all great things come in threes and in this story it’s no different. The heroes of our little anecdote being sunlight, water and nutrients. In other words, the sunshine and water represent your regular contributions into your savings and the nutrients represent the interest and dividends you receive for being a participant in the stock market. It doesn’t seem much at the time, but over the days, months and years that follow all those marginal gains begin to build up to something quite significant, until one day you have your very own orchard, row after row of trees, all beginning to bear fruit at just the right time.
Somebody’s sitting in the shade today because someone planted a tree a long time ago.
Warren Buffet
As we know the seasons do and will change and every so often the leaves will fall off and the years harvest might not be as fruitful as the last. That said, with history as the best guide we have we know 75% of the time we’ll be growing and thriving, whilst the other 25% of the time we’ll be having a temporarily low season. But those roots are strong and deep; we’ve been here before and we know we can weather this storm until the sunny days return. And they always do, one way or another, with an enduring faith in the future.
So, you now have a choice to make. You can start making the right, impactful, powerful financial decisions now with your tiny little seed. With the right care and attention you’ll start walking down that wealth creation path to where you want to be. Alternatively, you can dip your hand blindly into the instant gratification pot and hope you don’t get burned. And trust me, you will get burned if you go down that route.
Here’s my modest little pot. One day this will be an orchard – come join me.
Susie the succulent - dreaming big.