I may earn money or products from the companies mentioned in this post.
Yay, it's tax season. The exciting time when you have to deal with getting all your finances in order before April 15th to make sure you won't get fined extra for a delayed filing. Woohoo!!
For the fortunate ones, you'll be getting a tax return. And depending on how you originally filled out your W-4, it could be a pretty significant amount for you, especially if you're in your 20's. Sure that means you probably filed a few things incorrectly, but hey, now that you have this sweet return what should you do with it?
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There are only two things you should be doing with your tax return: investing it in yourself, or putting it away and investing it in index funds/individual stocks if you've done your research.
Let's face it, you didn't even know you were going to get this much back from Uncle Sam. Yea it feels great to have this money and think of all the things you can do with it. But why spend it on something that'll make you feel good for at best a few days? Your happiness level will go right back to your baseline and you'll be X amount of dollars poorer. At the end of the day, you'll probably just find ways to make excuses justifying why it was okay to throw all that money away on a sweet vacation because you “deserve it.”
What you should be doing is thinking of ways to invest the money, firstly in yourself. You should be trying to learn something new every day. The only way you're gonna grow is if you actively seek outlets that'll help you grow and achieve whatever it is you want. Maybe you've been meaning to learn how to increase your traffic on your blog. Or maybe you want to begin learning how to invest and don't know where to start.
I've spent over $2,000 to date on books alone. Sure, I could've invested it right off the bat, but then I would've given it all to my financial advisor who was at the time directly handling my money. It would've all gone to an overpriced international index fund or some other crap. I still can't believe the stuff my money was invested in at the time before I finally learned about all this. Unreal dude.
But instead of investing the $2,000 straight up into something that would really get me something like a 4% return if I kept it wherever it was for 40 years, I invested it in myself. I bought books, I bought courses. And not just on investing. I bought books on selling, advertising, psychology, anything that seemed applicable to the real world. This was way before I thought of creating a personal finance blog.
One of the best discoveries I ever made was in Grant Cardone. When I got my first job, I came across his name and his books on selling. His books are Sell or Be Sold and If You're Not First You're Last (no relation to Ricky Bobby). These two books showed me how to get over being afraid of cold calling, the fundamentals of selling, how to overcome objections and have scripts already memorized. I could go on, that's just the tip of the iceberg.
Because of these books, I become one of the best sellers on my team in my first two jobs being strictly a salesperson. I was smilin' and dialin' (and cryin' on the inside) every freakin' day. Yea it sucked and I hated the whole stigma of being a salesperson. But I'll tell you what, it didn't suck when the end of the month came around and I crushed it. I learned so much from this dude's books and podcasts it's incredible.
Oh, and I also bought The Closer's Survival Guide, which was awesome, because you could write down your counters to the anticipated rejections. It gave me a lot of practice and repetition, which is definitely what you need when you start out learning. You develop an arsenal of responses from memory to anticipate the several ways people can and will reject you. These three books are definitely great starting points.
I love this guy because he taught me the most important investment you can ever make is in yourself. Without that, you'll never grow, you'll never learn anything new and you clearly don't have what it takes to be the best you can be if you're not willing to put in the work.
He also taught me to understand there is always an abundance of money out there in the world. The only thing you need to be is hungry enough to get a piece of the pie yourself!
If you can figure out a way to help people, you'll have no problem rakin' in the dough. Listen to The Cardone Zone podcast and see what I'm talking about.
Another guy you may have heard of is Warren Buffett. He always says the best investment is one you can make in yourself. It beats investing in stocks by miles because you'll be more prepared and knowledgeable in the future when the time comes to actually invest in stocks. There is no rush, there are always bear markets to invest in.
So, one dude has a net worth of around $300 million and the other, $85 billion. It would probably be a good idea to heed their advice and maybe even write it down somewhere.
I did and even only 3 years later I notice a huge difference. Imagine what I'm gonna be like in 50 years at this rate! It's gonna be freakin' nuts. I already notice I think differently from my friends when it comes to money, and it's only been a little less than 6 years since we graduated college. They don't even think twice about other ways to make money, they just waste the money they make from their salary on ridiculous vacations they can't afford.
The other thing to invest in to give yourself a boost in your net worth is in index funds. Obviously, if you've done your research and put the time in, individual stocks are another option. But that is only if you've done your due diligence and practice what I am trying to teach you which is literally to read these books. Read every day to be as prepared as you can, and only then can you consider investing in companies that have public stock available.
And by prepared I mean researching the company, the board of directors and executives to who make up the company, how the CEO is compensated compared to the rest of the executives, read the annual report, read about their competitors, what the average p/e ratio is for companies in their industry, learn how to read a balance sheet, etc.
The only way you're going to make your money grow is if you make it work for you. Get it out of that savings account. That is the worst place to put it. It'll get old and stale and erode from inflation.
Don't be a dummy. Put your money to work investing in either yourself, an index fund or a phenomenal company to put your future self in the best financial position you can. Take that tax return and invest it today.
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