How does the investor think and how does 95% of us think?

Everything begins and ends in your thinking.

Now, I'm not going to write to you about positive thinking or to imagine a Ferrari, visualize it "flying" down the highway in a red "rocket" and when you step on the gas, there's an overwhelming "hum" under the hood that resembles the rampage of a pride of lions.

The wheels slam against the tarmac and the Ferrari surges forward at speeds of unimaginable force until you are slowed down by a healthy respect that sends a strong inner shiver and chills through your body during this driving experience.

It's a very nice idea, but believe me, even after a week or many months of disciplined visualization, this Ferrari won't just appear under your window in the parking lot.

An investor who wants a Ferrari thinks like this:

'I won't buy it with my own money, that's nonsense. I will find a way to get a Ferrari without having to invest my own hard-earned money in it."

The investor does not spend his own money to buy the car. No way. Forget it! A car is a consumer good that loses value the moment you drive it out of the showroom. An investor doesn't put his money into this one. It goes against his beliefs and his principles.

Oh, look out! Even so, he drives luxury cars! So how does he do it?

Who spends their own money on a new car?

Those who have the least. Ordinary people who have to work every day to earn money. Those who have to get up early every morning, come to work, work very hard for 8-10-12 hours to get money in their account once a month.

And what happens if they don't come to work? They get a much smaller paycheck or even nothing. If they are fired or can no longer continue, they will lose their steady income, their housing, simply everything they have to invest money in on a daily basis.

A friend of mine was saving up for a new car...

I know a man who saved for 10 years for a new car. For 10 years he eliminated every possible expense, deprived his family of experiences, stopped seeing friends for Friday beers. He kept his spending to a minimum.

10 years of life No holidays, no other little things that make people happy on ordinary days, just to make a dream come true and buy your dream car.

What has he done after 10 years?

After all, he bought his dream car for €30,000. A few days later I was sitting in his living room. He was sitting tiredly on the sofa, telling me about how his new car was parked in the car park directly below the window.

At that moment, when he talked about his coveted car, he did not show any joyful emotions. He didn't seem to be excited about the new car in front of the house. Perhaps that feeling of spontaneous joy was gradually beginning to fade. I don't know.

Or maybe he was too tired because he had been pulling overtime and working like a horse for 10 years. He worked from morning till night, without rest and without other pleasures that a normal person indulges in during the day.

I didn't say anything to him

I didn't want to tell him right then that what he did wasn't very sensible and he could have got the car much easier, faster and without overtime.

I asked him just one single question:

,,What are you going to do now? You already have a new car. Do you have another goal?"

He smiled and said, "Yes, I do. But I need to work for a few years to be able to afford it. You know, us regular people we have to work hard to afford what we want."

I went away and pondered this attitude of his long into the night. I wondered how many people think the same way? And how much it would help them if they got even a pinch of investor wisdom?

Their lives would certainly change! To waste such a short time of our lives in this slavish way? That is very, very wrong!

I'll come back to my friend with the new car and explain, what he actually did and how most of us think.

• 10 years of overtime and extra work. He has deprived his family of every possible experience just to buy a car for EUR 30 000.

• A new car will lose 40 % of its purchase price value after only 3 years. After 5 years up to 60 % of the purchase price.

• What did he actually invest in? He saved for 10 years for something that will take 60 % of all his savings after 5 years.

If he sells his car after 5 years, he gets €12 000 for it. 10 years of life in the road and under the window of an old car that has lost 60 % of its original value.

What will my friend do if he sells this car after 5 years? Will he start saving for a new car again?

Another 6 years of overtime and hard work, without holidays and other pleasant moments with the family, in which it is necessary to invest even 10 EUR.

Total madness

Well believe me, a lot of people do exactly that. The smarter ones will say, "OK, €12,000 down payment for a new car and I'll split €18,000 into lease payments."

What happens then? Nothing.

It's the same situation, except that you have to work every day to earn the lease payment, which is plus interest.

So you have no chance to stop working or spend the money elsewhere, because if you don't make the repayments, they will take the car and the €12,000 you put in at the beginning.

That way you will get wiped out! Literally. You'll be paying high monthly payments for something that is losing value by the day.

If after 5 years you pay off the last instalment, you breathe a sigh of relief. Well the car is worn out and its value is again somewhere at 40 % of the original value.

What will you do?

You say to yourself: "I don't give a shit anymore!"

And you drive an old car for the next 10 years because we "regular" people just don't have the money for it.

Or... you sell the car for 12 000 EUR. You use this amount as a down payment on a new car, but again you have to pay it back with interest.

This means working even harder than before. And to cut off everything you feel like in this short life of ours.

And this goes on forever. 100-odd families operate in exactly this way. They work hard every single month to afford the consumer "toys" they crave.

I used a car as an example, but it could be anything else that investors consider liabilities. That is anything that loses value daily or takes more money out of your wallet.

An investor, unless his life is at stake, will never use his own money for liabilities. He puts his own money into "toys" which increase in value or regularly bring in new money. And only with that money will he buy a new car! Watch out, here's the huge difference.

Simple, even primitive logic. But it is used by at most 5 % people on the planet.

My other friend learned the only investor's prize

I will now write you one know-how that should be taught to children in primary school. It's not the strategy of billionaires, but the mindset of ordinary people using the basic principles of an investor.

My other friend, an unassuming, very calm and composed person, has for 20 years out of nowhere inybuilt passive income approx. 4 000 EUR per month.

How did he invest EUR 30 000?

Do you think he bought his dream car with that money? He didn't. And why didn't he? Doesn't he dream of a new car?

On the contrary, he dreams. Like every guy. But he did it differently.

First he invested EUR 30 000 into real estate with a very decent interest rate of about 14 % p.a. He started to receive a regular passive income of about 350 EUR per month.

And what can you do with this income? Anything you want. This is your passive incomegenerated by your first investment. Do whatever you want with it.

You can reinvest it to achieve a passive income of €700 per month in a few years, which you reinvest. Within 20 years, your passive income will reach €4,000 per month. And that's without working, as my other friend did.

Or buy a new car with the proceeds. On hire purchase. You pay for the car with the proceeds, not with your hard-earned money. This is a huge difference! You don't scrimp on money every day to make a car payment.

Your investment of €30,000 is worth driving around in a new car.

If you pay off the car, sell it, book a holiday for your family and buy another new car. On hire purchase.

Because your investment of €30,000 is still appreciating and bringing you passive money into your account. Without work.

You don't need to work harder. You don't need to take overtime. You don't need to rob your family of experiences anymore.

Please. Your hard earned invest your money in assetsthat will bring you more money. That is the only way not to go broke and to get real wealth.

Don't buy consumable items, liabilities with money that you have to earn with your time and effort. Always, if you want to do such a thing, consider how to do it differently.

Because if you start spending money earned by your time on things that lose value, you find yourself in a vicious circle of perpetual lack of time and money.

How to avoid slavery?

In my next blogs you will learn how an investor invests his 30 000 EUR without ever having to save it.

The investor won't argue. It uses various financial "levers" to make immediate investments and earn returns. It's just a matter of deciding what to invest in and how much.

This is how the richest get richer. They drive expensive cars, they travel around the world with the feeling that there is enough money flowing into their account every day to afford anything they want.

Remember. Everything begins and ends in your thinking.

It's not about hard work and unfair advantages for the rich. Each of us can change our lives within a few years just by certain choices we can make at any time. Even today.

And what do you long for?

After a car, a motorbike, a holiday, a new computer? ️

Just don't buy that paycheck you're exchanging for your time at work. Otherwise, you'll wear yourself out. Think about it, invest in passive income and only the proceeds of that income use it to buy consumables that are depreciating in value.

Fingers crossed for you on your passive income journey!