15Diverse Investment Strategy
While saving your money is good, investing it may be even better. The richest of the rich all invest their money, so that they’re making more money off of the money they already have. This is known as passive income and it’s a wonderful thing. It allows them to have
multiple streams of income and financial security. The millionaires of the world know that sometimes you have to make risky investments that will pay off in the long run but they don’t go dropping their cash foolishly. They know that they must try their best to avoid risks while maximizing potential rewards, and they carefully consider the risk to reward ratio of investments. They’re the ones that choose to invest in promising businesses or in real estate that will produce cash flow. They also favor the stock market. In fact, the World Wealth Report showed that in 2014, stocks overtook cash as the number one asset in portfolios of high net-worth individuals. But they don’t put all their eggs in one basket. Instead, they invest diversely and most of them (about 80%) enlist the help of a professional financial advisor. Nevertheless, they are actively involved in the decision-making related to their investments.