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Can you get rich quickly?

There is sometimes a pressing need, or maybe just a desire, to make money quickly. You might need to buy a car or pay for a wedding. You might want to be able to afford a larger house or to go on more luxurious holidays.

Whatever the reason, there is no doubt that most of us would want to get rich quick. The idea of making money with very little effort is certainly appealing. But is it possible?

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

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Bubbles

Every once in a while, you hear about something that has got a lot of people wealthy, in a short amount of time.

Look at Bitcoin. The cryptocurrency surged in value in 2017. At the time, financial pages of the newspapers were in a spin, as more and more people ploughed money into it. But Bitcoin has been up and down since then and many will have lost money from it.

And then look at Fevertree. The stock price rose an incredible 2,000% in almost four years after the company was first listed. But since the high in 2018, the share price has dropped by 60%.

I think Fevertree’s fate was in some ways aligned with Bitcoin’s. I believe some people saw the rising share price and jumped on the bandwagon without thinking it through. As explosive growth slowed down, the elevated share price fell.

At least Fevertree is a real company making real products that real people buy, leading to real profits. The same cannot be said of Bitcoin.

But I am always sceptical of any investment targets that grow so quickly. Often, like Bitcoin, they strike me as a bubble just waiting to pop.

I’ve come to recognise that if everyone is talking about something, it’s probably too late for me to jump on board. By then, the price of the asset would have grown, and the early investors will probably be looking to pull out their money.

I think there is a better — and more sustainable — way to build wealth.

Get rich slowly

Warren Buffett’s advice is to not lose money. When you are investing, it is hard to bounce back from losses.

For example, if you have a £1,000 investment that loses 10%, your investment will be £900. It will need to grow by over 11% to get to £1,000. As investors, we need to ensure that compound interest is working for us, and not against us. Over our investing lives, compound interest can make a significant difference to our wealth. 

How can we ensure we follow Warren Buffett’s advice not to lose money?

I think the best way is to think of investing as ‘getting rich slowly’. You don’t need to take excessive risks to get rich. I believe the first aim for investors should be to not lose money.

One way to avoid losing money is to step away from get-rich-quick ideas. If the bubble bursts for alternative investment vehicles, or overly touted stocks, you want to ensure your money is nowhere near them. Let it grow nicely in sustainable businesses that you’ve done due diligence on instead.

Putting money aside each month into an equity or index fund you have faith in can get you rich, and will mean you’ll probably sleep better at night.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US $12.3 TRILLION out of thin air…

And if you click here, we’ll show you something that could be key to unlocking 5G’s full potential...

It’s just ONE innovation from a little-known US company that has quietly spent years preparing for this exact moment…

But you need to get in before the crowd catches onto this ‘sleeping giant’.

Click here to learn more.

T Sligo has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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