It’s tempting to keep all your money in cash because it seems so safe, right? After all, it’s guaranteed by the government. However, you’ll never build wealth when you’re losing money to inflation.

Stocks, on the other hand, feel so risky. Most of us, including the dictionary, see risk as “the possibility of loss.” But as smart investors know, risk is an opportunity for gain.

In fact, the biggest risk you take, as a woman, is not that the market will go down. Because it will. It always does. But it also always goes up.
 
The biggest risk that you and I take is that we will OUTLIVE our money…that our purchasing power, like a wool sweater in a hot dryer, will shrink over time.

So at least a portion of our money must be invested in assets that grow faster than inflation and taxes take it away.

If you enjoyed these “Words of Wealth”, head over to my website and sign-up for my FREE weekly newsletter at: www.barbarastanny.com

In 1926, George Clausen, publisher of the first road atlas of the United States, wrote a slim volume of parables about Babylonia, once the wealthiest city in the world. The Richest Man in Babylon has become a modern classic that some people, including me, consider among the best finance books ever written.

When we first meet the richest man in Babylon, he is telling friends the secret to his fortune.
“I found the road to wealth,” he tells them, “when I decided that a part of all I earn is mine to keep.” The men look at him incredulously.

“Is that all?” one asks, insisting that of course everything he makes is his to keep.

The wealthy man just shakes his head. “You fool, you pay everyone but yourself,” he cries, pointing to the clothing sellers, sandal makers, and wine merchants. Instead, the rich man counsels them, pay yourself first. “For every 10 coins thou places in thy purse, take out for use but nine.”

This is the way of the wealth builders. They pay themselves first, knowing that a part of all they earn goes into their personal savings on a regular basis.

Are you living that way?

Over the years, I’ve witnessed an inverse correlation between earnings and debt. As debt goes down, income increases. And vice versa.

Perhaps it’s because, as one person explained, “Now that I’m not worrying about how I’ll pay my bills, it’s like I’ve freed up all this energy to be so much more creative, strategic and successful in my career.”

Want more success? Tear up your credit cards and start paying them off. Then watch what happens!