Fifteen wealth myths that hold you back: Part two

In a previous article I explained despite living in a land of plenty, the sad reality is that the majority of Australians will never achieve financial freedom.

On the other hand, a small group of Australian property investors are becoming very wealthy in property.

Today I continue exploring the common money myths that hold many people back from achieving their financial goals.

Myth #8: The rich are lucky

The truth is that success in wealth creation is no more about luck than is success in anything else in life. To become wealthy you have to be in control of your finances and not count on good fortune. When you have a proven investment system or strategy, luck becomes unnecessary.

As a child, I used to play Monopoly: Sometimes I won, sometimes I lost.

As an adult, I’ve played Monopoly a couple of times with some financially intelligent people and I realise now that, contrary to what I thought when I was young, it’s not a game of luck.

Good players know the right spots on the board to get the best return on their investments. They know how to acquire and control the best “monopolies” in order to collect the highest rents. They’ve learned to negotiate and find ways to make great deals. They’ve learned how to take the luck out of Monopoly and consistently win big as a result.

To me, this sounds a whole lot like the real world of investing. You need to learn how to take the luck out of wealth creation and instead develop smart strategies to get ahead. First you need to learn how to play the game, and then you need to know how to win the game.

Myth #9: To become rich you must diversify

Wrong! Yet that’s what most financial planners suggest, isn’t it? Diversification leads to an average outcome. I’ve found that successful investors don’t diversify; they cultivate the skills required to make better, smarter investing decisions and specialise in one niche.

Myth #10: Paying off your house provides security

This is one of the old myths many of us learned from our parents, who probably learned it from their parents. But it doesn’t make sense in the new financial era. The problem here is that once you’ve paid off your house, you end up with idle equity sitting under your roof doing nothing; equity you could use as a deposit to buy an investment property and grow your wealth.

Myth #11: All the good investments are taken

That’s not true – opportunities are always out there – in every market. Sometimes there are a lot and sometimes there aren’t. Some are obvious and others are opportunities you create by understanding investment markets. Sure, all of yesterday’s deals have been taken, but tomorrow’s deals have not. Someone will snap them up. Why shouldn’t it be you?

Myth #12: If you want to do it right, you have to do it yourself

There’s no such thing as a self-made millionaire. All successful property investors have a good team of professional advisors and supportive mentors around them.

That doesn’t mean you should hand over full responsibility for your wealth creation to others. But the rich recognise they can’t have expertise in all aspects of wealth creation, so they find a team of experts they can lead in order to help them achieve their goals.

Myth #13: I’ve done everything wrong! It’s too late

It’s never too late to learn how to invest or to overcome your mistakes.

There are many success stories of people who conquered all sorts of adversity, or started investing later in life and ended up achieving financial freedom. In fact, Ray Croc was over 50 years old when he built his very first fast food outlet. You might have heard of it – it’s called McDonald’s.

Myth #14: Debt is bad

Most Australians believe debt is a dirty word, but not all debt is bad. Savvy property investors know how to use good debt to buy appreciating assets.

Myth #15: It doesn’t matter what I want – I just can’t do it

Subscribing to this myth is almost a guarantee of failure, because our beliefs and perceptions become our reality. Some people who’ve had a few failed attempts “learn” that wealth is beyond their control and they can’t affect the outcome. They remain in a cycle of victimisation all their lives.

This is one of the reasons why the rich get richer – they believe they are in control of their destiny. You must also believe you’re in control and act as if you’re in control. Then pretty soon you’ll be surprised by the results you achieve. Invariably, the more success you have, the more your thoughts about what you can and can’t control will alter for the better. Yes – you can do it!

There’s no way money can know who’s in control of it, what their qualifications are, what ambitions they have or what they’re going to do with it. Money is there to be used and spent, saved and invested. It can’t judge whether you’re worthy or not.

Now that you understand some of the myths that have held so many people back, the good news is you can do things differently. Choose to change your beliefs to produce outrageous results and reach every goal you set.

Michael Yardney is the director of Metropole Property Investment Strategists, a best-selling author and one of Australia’s leading experts in wealth creation through property. For more information about Michael, visit www.metropole.com.au or read his Property Investment Update Blog.