STARTING WITH nothing, can you really become a millionaire over the next 15 years through an aggressive alternative investment strategy? The compound calculator says yes, but what are your chances of actually being able to realise the returns needed to achieve those final results? The answer depends on your current financial situation, your willingness and ability to stick with an aggressive investment plan, and the quality of the alternative investment vehicles that you choose.
For example, if you start investing US$300 every month today into certain aggressive alternative investments that return an average of 60 per cent annually, you will have accumulated well over US$2 million in 10 years time. Yet, this is a poor financial plan which is unrealistic for several reasons not the least of which is that you will be taking too high a risk with too much money in the later years in order to generate that kind of overall return. However, this is a great way to start, and if you are careful about the investment vehicles you choose you can certainly obtain that return within an acceptable risk profile. My suggestion is to go three years at this 'level' in your plan, at which point you'll have accumulated about US$30,000.
REDUCING YOUR RISK PROFILE
Now that you are ready for the next level, you are going to want to reduce your risk profile and put that US$30,000 into better quality vehicles, which invariably means lower returns. Continue to make that US$300 monthly spend to your portfolio. With a 30 per cent average annual return, you will have amassed over US$1,450,000 in an additional 12 years time, or 15 years total. Of course, this figure assumes that you did not have to remove any funds to in order to pay taxes and that is a big assumption! For that reason, you should structure as much of your portfolio in non-taxable growth entities as possible, including: IRAs, IRA rollovers, certain variable annuities, or properly structured offshore accounts.
Other exmples include the following:
Aggressive trading accounts (either managed accounts or self-traded using a good signal service); private equity arrangements in small businesses; pooled venture capital funds; and, other interesting opportunities that come your way. Realise that your choices in the beginning, when you have only a few hundred dollars to start with, are going to be quite limited as compared to when you are ready to move to the next level. But you still need to insist on only top-quality opportunities. Playing pyramid games or being duped into a ponzi scheme will only make you have to start over again.
AVOID PITFALLS OF ONLINE INVESTING
To be successful, you must avoid the pitfalls of the online investing community. Stay away from anonymous e-currency investments that you cannot verify. Do not place money in too-good-too-be-true offers. Insist on knowing who your financial partners are and demand credentials, along with a verifiable performance history of any trading account. Do not become the victim of con artists or unskilled money managers/ advisers. Avoid affiliate marketers, degenerate gamblers who want to gamble with your money, and anyone that you heard breached someone's trust in the past. Put the odds in your favour by only doing business with honest, reputable, real people who have nothing to hide and whose operation makes sense. Make a plan that you can stick to. Stick to your plan. Choose your investment accounts wisely. Do these things and your aggressive wealth- building strategy will have an excellent chance of success!
