I’m on a mission this year to encourage everyone that crosses my path to invest. I wholeheartedly agree with the quote by Carlos Slim which says: “Anyone who is not investing now is missing a tremendous opportunity.” If you have a long-term financial goal, then saving alone will not get you there; you need to invest. I’ve therefore tasked myself to spread the good news about the simplicity of investing far and wide. Watch out for my next book on investing titled “The Beauty of Compounding”.
Today, let's talk about ‘Levels of Investors’. This is something I learnt several years ago after reading Robert Kiyosaki’s book “The Cashflow Quadrant”. The levels of investors will help you identify where you currently are on your wealth-building journey, and what your next level should be in order to make progress. Let’s deep-dive into the seven levels:
Level 0 - Those with Nothing to Invest:
These people have no money to invest. They either spend everything they earn and live paycheck to paycheck, or are high earners but not managing their finances well.
Level 1 - Borrowers:
People at this level are not conscious of their spending habits. They appear to look rich but are deep in debt. They borrow to fund their materialistic lifestyle. They buy high depreciation assets with debt.
Level 2 - Savers:
People in this category were taught that being financially responsible means being a saver. They spend their time trying to save pennies instead of learning how to invest. They are not willing to take any financial risk.
Level 3 - Smart Investors:
These are educated and intelligent people. However, when it comes to investing, they are uneducated. There are 3 types of Smart Investors. They are either “I Can’t Be Bothered” type, “Cynic” type, or “Gambler” type.
Level 4 - Long-term Investors:
This level consists of people who are clearly aware of the need to invest. They are actively involved in their own investment decisions and have mapped out their long-term goals with financial vehicles.
Level 5 - Sophisticated Investors:
These people have solid financial knowledge and they are savvy about the strategies they use. They are focused on continuously growing their asset base, and own controlling stakes in corporations.
Level 6 - Capitalists:
This is the level of investment excellence. These people leverage other people time and money to create opportunities for everyone. They are the movers and shakers of the world economy who create jobs and goods.
Have you identified the level of investor you’re in? Do you have a plan to move to the next level? When it comes to our personal finance, our focus should always be on making progress. This new week, I encourage you to positively shift from your current level to the next. Don’t just work for money, let your money work for us through investing!
About Nike
Oyenike Adetoye (aka Nike) is an impactful speaker, author and personal finance expert. A Chartered Management Accountant by profession. Nike is the founder and CEO of LifTED Finance, a private financial firm that educates, coaches and supports people on their journey through financial fitness and wealth management.