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The Most Important Investment

  • The Millennial Millionaire
  • Mar 4, 2018
  • 3 min read

There are many investments which can end in fantastic returns. However there is one that is often overlooked.

Properties or the stock market could double the money you've invested in 7 years or so. However, in order to benefit significantly, you need money to start with, and a lot of patience.

 
 

The fact of the matter is that while we millennials are young, it is the money that we invest now that will have the greatest gain in the form of compounding.

So, what's the best 'get rich quick' strategy?

What is the most important investment for the younger generation?

Yourself. Investing in yourself.

 
 

Be it books, further qualifications, personal or people skills. All of these things will help you build networks, grow in knowledge and allow you to be more confident in yourself.

Those who keep learning and are open to new information when it becomes available are the ones that become the most financially free.

 
 

For example, I am attempting to qualify as an actuary. I know that I could make investments that will yield almost 20-30% in the time being. However, I also know that by focusing on my exams, I could double my salary in 3 years.

So that's my focus.

But make no mistake. That's just one route.

There are courses and information available for just about everything online. Be it for starting a side-hustle like a Shopify store, or Amazon FBA for which I go into more depth in 8 Passive Income Streams.

 
 

There are so many sources of information available, that there is no excuse in not absorbing as much of it as possible to help with your career, health, prosperity or relationships.

All of these things are far better investments for your short-term future than any stock or property could provide you with.

Don't get me wrong, making other investments in property and stocks are the key to becoming financially free.

 
 

However, learning new skills and new information could land you a much better job or a promotion, allowing for more cash flow and far better long-term gain.

Let's compare 2 individuals, one happy on the UK median salary of £30,000. The other constantly seeking new information and knowledge to progressing within the career, on the same salary.

Let's assume they are both 21 years-old too.

If the one constantly seeking new information has their salary increase by 10% per year, through sheer hard work, after 10 years they'll be on £77,812.

Let's ignore income tax for the time-being, but keep in mind that of course the £77,000 would be subject to a lot more income tax.

Let's assume that now the second person is happy and settled at this point, and both invest 25% of their salary. The higher earner invests £19,453, while the lower £7,500.

 

 

If they continue to save at this rate, investing their money into index funds with an average return of 7% per annum over the next decade, the one on £30,000 would have £110,876.

The person on £77,812 would have £287,585.

Let's fast forward another 20 years.

The higher earner would have £1.95 million, while the other would have £758,000.

 
 

It is so important to invest in yourself while young, the likelihood is that you could earn a lot more than any other investment made in the early stages of your career.

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