Getting Wealthy — Investing Rulebook Of The Wealthy
There are 12 Rules of Investing that the wealthy follow.
RULE 1 — Invest Early
Investing early will give you a lot of advantage like getting more returns and scope of potential gains is really high.
RULE 2 — Invest Often
Investing often gives you the advantage of getting your average price of crypto down. This is really helpful in bear markets since you’re able to Dollar Cost Average on your crypto which gives you better returns in the bull market.
RULE 3 — Don’t invest money that you cannot afford to lose.
Only invest money that you can afford to lose
RULE 4 — Always have cash/usd to buy the dip.
When a really good opportunity presents itself to you, you want to be present with stack of cash in your hand.
For me, I keep at least 10% of my Portfolio in stable coins and am slowly increasing it to 20% so it acts like a hedge too.
RULE 5 — Investing is mostly boring.
Investing doesn’t provide a dopamine hit which you seek and don’t expect to get immediate higher returns regularly.
You’ve to understand that most of your money will be made in a few weeks followed by few months/years of boring periods of bear market and consolidation phases.
RULE 6 — Always Do Your Own Research (DYOR) before Investing.
This will help you in understanding what sectors you are great at. Finding out your unique strength is really important.
RULE 7 — Only invest in projects you understand.
Most crypto projects are in one of the 3 phases -
2. Alpha/Beta product
3. Fully functional product
Since all of these are companies/startups, 95% of them will fail in the next 3–5 years just like the regular world.
Your goal should be to find really good ones and stick to them.
RULE 8 — Money is a zero sum game in crypto.
In order for you to make money, someone else has to lose money.
There are 2 kinds of money -
1. Smart money
2. Dumb money
Smart money is mostly mature money. It has a plan, PAYtience and grit.
Dumb money is mostly new money. It has Lambo and moon dreams, get rich quick mindset and shiny object syndrome.
RULE 9 — Book profits.
Experts say cryptocurrency is the biggest game of wealth transfer and in this game of wealth transfer, you want to be on the side that gets the wealth and not on the side that gives away the wealth.
This is why it’s really important to book profits regularly.
RULE 10 — Always protect your capital.
Legendary investor Warren Buffett has 2 rules of investing -
Rule #1. Always protect your capital
Rule #2. Always remember Rule #1
RULE 11 — Don’t be greedy
Crypto is going to shortcut your path to wealth but it cannot do it in a day, week or month.
Earlier, the average age to become a millionaire was late forties and early fifties but today, thanks to crypto, people have started becoming millionaires at least 15–20 years before.
Crypto is shortening the curve of people who follow their plan but people who aren’t following a plan are going to get REKT.
RULE 12 — Never break your own rules.
As kids, it was fun saying rules are meant to be broken but rules are not meant to be broken in crypto. The more times you break your rules, the more times you tell your brain that you cannot maintain your self trust.
If there’s a very special or serious situation where you need to break rules, only do it if you’ve evidence to support it else skip it.
Follow these 12 rules of the wealthy and become wealthy.
Also, here are some useful links to save and reference. Let’s go and help you achieve your goals. ;)
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