Getting Rich Quick: Tony Robbins’ 7 Wealth Tools Could Make You a Fortune
One of Tony Robbins’ main pieces of advice to investors is to create a three-bucket system for allocating your money. The first of these buckets is the security bucket: cash savings and safe investments such as bonds or market-linked certificates of deposit, which you can use as a foundation for building wealth. Another is investing in your dreams, whether that’s a vacation, a gift for your family or an important purchase.
Check Out: 5 Retirement Planning Tips Tony Robbins Swears By
Learn More: 4 Genius Things All Wealthy People Do With Their Money
However, the middle bucket is the growth/risk bucket. This is where Robbins says the opportunity for rapid returns can be found. By taking controlled risks with money you can afford to lose and picking your investments carefully, you may be able to grow your money faster than you would with a passive index fund or savings account.
Here are seven fast-growth investments that Robbins recommends.
Equities
Equities represent shares of ownership in a company. Investors buy stocks with the expectation that their value will increase over time as the company grows.
Returns on equities come from capital gains (selling the stock at a higher price than it was bought for) and dividends (periodic payments made to shareholders from the company’s profits). A well-performing company can see its stock price rise significantly, offering substantial returns to its shareholders.
The main risk with equities is volatility. Stock prices can fluctuate widely based on external factors like economic conditions, market trends and the company’s performance.
Owning individual stocks is riskier than with diversified investments such as mutual funds or exchange-traded funds because a poor performance from a single company can significantly impact your investment.
Explore More: 10 Valuable Stocks That Could Be the Next Apple or Amazon
High-Yield Bonds
High-yield bonds are issued by companies with lower credit ratings. The “junk” status comes from the higher risk of default; but, in return, these bonds usually offer higher interest rates to attract investors. The primary return on high-yield bonds is the interest income they provide, which is higher than that of more secure bonds due to the increased risk.
The main risk is the possibility of default. If the issuing company runs into financial trouble, it may not be able to pay back the bond’s principal amount or continue making interest payments. This can lead to significant losses for investors.
Companies aren’t the only entities that issue high-risk, high-reward bonds. While bonds from countries like the U.S. are usually considered to be safe investments, countries such as Turkey, Egypt and Zambia offer bonds with much higher yields and much higher risks.
However, investors should carefully research the country in question before investing. These yields are often high because the country has either recently defaulted on its debt or is likely to do so in the future.
Real Estate
Real estate investing involves purchasing properties either to sell at a profit or to rent out for ongoing income. This can include residential, commercial or industrial properties. Investors can profit from real estate through rental income and property appreciation. As real estate values increase, returns can be realized through selling at a higher market price or refinancing at better terms.
The risk with real estate is that the market can be volatile and properties can depreciate in value due to environmental or occupant damage. Other risks include liquidity constraints (it’s not always quick or easy to sell property), high initial investment costs and the ongoing expenses of property management and maintenance.
Commodities
Commodities include physical goods such as gold, oil and agricultural products. Investing in commodities often involves buying futures contracts or commodity-linked financial instruments instead of the commodity itself. That way, you don’t need to figure out where to physically store your investment in wheat or oil, for example.
Returns come from price changes in the market, driven by supply and demand. For example, gold prices might rise during economic uncertainty as investors seek safe havens for their money.
However, commodity prices can be volatile. Factors such as weather conditions, political instability and changes in economic policies can drastically affect the prices for different commodities. Each commodity will have its own set of factors that affect the price. If you’re going to invest in orange juice futures, for instance, make sure you know what’s needed for a good orange harvest.
Also, commodity futures investors should be aware of expiration dates. If the contract is held through the expiration date, the trader must be prepared to take or make a delivery of the physical commodity, according to the terms of the contract. Your brokerage may automatically close your trade for you before that happens; if it doesn’t, you may end up having to figure out where to put your new sacks of soybeans.
Currencies
Foreign exchange (forex) trading involves exchanging one currency for another in hopes that the currency you buy will gain strength relative to the one you sell. Profits are made on the fluctuations in exchange rates between pairs of currencies. If you buy euros with U.S. dollars and the euro strengthens relative to the dollar, you can sell the euros back for more dollars than you initially paid.
The forex market is influenced by global economic conditions, interest rates, political events and market speculation, which makes it highly volatile and complex. Forex trading is not something to jump into lightly.
Collectibles
Collectibles include art, rare coins, stamps, vintage cars and other unique objects. These assets are considered alternative investments and can appreciate in value over time. Money is made when these items are sold at a higher price than they were purchased for. The appreciation can be significant if the items become more desirable over time.
The risk with collectibles is that the market can be niche and highly subjective. Values can fluctuate unpredictably based on consumer interest and market trends. Additionally, there are concerns over authenticity, preservation and liquidity. If you store your collectibles incorrectly and they get damaged, you can lose your entire investment all at once.
Structured Notes
Structured notes are debt securities issued by financial institutions. The returns depend on the conditions set in the notes, typically linked to the performance of an underlying asset. If the asset performs well, the note pays out according to a predefined formula; if not, the payout might be less, or even zero.
The primary risk is the lack of principal protection. Investors might lose part or all of their initial investments if the underlying asset performs poorly. There is also credit risk, as the ability to pay depends on the issuer’s financial health.
Consult an Advisor
Each of these investments fits into Tony Robbins’ growth/risk bucket and could offer you high returns. However, each also carries its own set of risks. It is always a good idea to consult with a financial advisor before making any risky investments. A qualified advisor can provide personalized insights and guidance for your specific financial situation so you can get the best return for your money.
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