I am a sucker for catchy headlines more than the next guy I think. Especially when it comes to money, health, fitness, and wealth building. So if you are like me and this headline grabbed your attention I will get straight to the point and why you are here.
The biggest wealth creation tool you potentially possess, you just have to develop it more. Is long-term thinking. Yelp. That is the biggest wealth creation tool you already own.
Most people don’t figure this out until late in their forties and the lucky few figured it out in their twenties.
I am not sure where I heard this before, but I didn’t come up with it my own. But there are four kinds of thinkers. And each of these types of thinkers lives are controlled by the way they think about the future.
As I walk through the four types of thinkers here. My guess is as you read it a picture of someone you know will come to your mind that subscribes to each one of these thought patterns. And each of these peoples financial and overall life conditions can be explained by their thinking process.
You know people that are thinking about today. They just want to get through the day. They know they have to get up and go to work. Or maybe they don’t, but all they are thinking about is how can I get through the day.
You then know people who are thinking about Friday on Monday. Then on Tuesday they are thinking about Friday and the upcoming weekend. All they think about during the week is the upcoming weekend. They know where they are going to eat, what they are going to do. Who they are going to do it with.
The third kind of thinker has the ability to think a little bit longer term and they are thinking about the next year and maybe the next three to five years. These people are actually pretty good at setting goals and achieving them in their life.
And lastly, the fourth kind of thinker is the person that has the ability to think much further in the future, maybe it is a decade or more. Again, these people have the ability to think what they want their future to look like and then get to work to make sure they achieve what it is they want.
Someone once said that the people who can think furthest in to the future are the ones who are most successful.
A couple of really good examples of this is Elon Musk and Benjamin Franklin, one of our founding fathers.
Elon Musk is thinking about the future all of the time. He is thinking “What if we need to be able to inhabit another planet one day”. Space X. He has been thinking about electric cars that operate like gas powered cars for the last twenty years. Tesla. And he is always out in front and thinking way ahead and has been rewarded for it.
His second company that made him several hundred million dollars was PayPal. He knew the internet was something that could change the world. But it could only change the world if there was a way to connect money and the ability for money transactions to take place on the internet.
He is always thinking about the bigger picture and he is the wealthiest person on the planet because of it.
A second example of a long term thinking is no other than one of our founding fathers. Benjamin Franklin. When he died he left money in two funds. This below from the Centre Foundation explains Mr. Franklins investment.
In his will, Benjamin Franklin left $2,000 to the city of Philadelphia and $2,000 to the city of Boston with the direction that it could not be drawn on for 100 years and could not be distributed for 200 years. The funds were invested and after the first 100 years, the funds began making personal loans to the citizens of Philadelphia. After the 200 years were up, the State of Pennsylvania directed the money to be split between most of the community foundations in the state. Distributions from the Ben Franklin Fund at Centre Foundation are used to make grants to Centre, Clearfield, Huntingdon and Mifflin counties, benefiting Citizens of the Commonwealth and paid to qualified charities within the region. Grants from this fund are currently distributed as part of our competitive grants process.
In 1894, at the end of the first 100 years, the Boston fund had been used as instructed [to aid apprentices] and had grown to 131,000 pounds ($391,000). In the following century the bulk of the proceeds were used to fund public works in Boston. In 1905, $322,490 was used to establish the Franklin Union, a technical school. The remainder of the funds continued to be loaned out for apprentice programs and scholarships.
In 1990, the end of the second century, Franklin’s Boston endowment was worth more than $5,000,000 and the Philadelphia fund about half that. In both cities Franklin’s endowment has been used to help thousands of young people and has served as an enduring testament to philanthropy and community service.
It is hard to get an exact number on how much money was generated from Benjamin Franklins original investment. But we can all say it has been a lot and it has impacted a lot of people over the last 200 years.
But this is the power of thinking long term. Success is hard and it takes a long time to get it. You need years of compounding to accumulate great success in anything. Wealth, Health, relationships, etc.
Going back to the four kinds of thinkers. The people who are just trying to get through the day. Typically don’t nurture long term realtionships. They don’t save money and they definitely don’t invest.
The second group of thinkers who are just trying to get through the week. These folks think that they have earned their weekend. They worked hard all week and now that the weekend is here and it is theirs to enjoy. I am not saying relaxing from time to time isn’t important.
However, most successes in life aren’t created while working your forty hours in the week. It is what you do in your spare time that gets you ahead in life. It could be taking a class that allows you to get a better job. It could be working a second job that allows you to put aside additional money to invest. Or it could be a variety of different things.
The third group of thinkers has that ability to think longer term and they are thinking about what they can do over the next year to get closer to where they want to go. They can typically delay gratification longer than the other two types of thinkers. Which this allows them to save and invest more money, time and effort where necessary.
A person that can think about the next year to five years is more aware of how the decisions they are making today can impact their future. They are future oriented.
And that person that can think ten years in to the future. These people can definitely delay gratification in most cases for the bigger picture. They are designing their life the way they want it and not just living a life.
What kind of thinker are you?
I obviously talk a lot about real estate on this site. And as I mentioned before, real estate is a long term play. It isn’t a get rich quick scheme. When you purchase real estate you should be thinking of holding that deal for at least five years and most likely ten depending on what happens in the marketplace. Or in some cases, hold in until you die.
To your success and your future.
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