No longer relevant…

Knowledge is not power!

Only some know that this phrase “Knowledge is Power” was made popular by British philosopher, Sir Francis Bacon from 16th century [1. From "Scientia potentia est" (latin) - see http://en.wikipedia.org/wiki/Knowledge_is_power]. And as we know, around that time, the human race still in the middle of so called “Scientific Revolution” where basically we were still confuse about a lot of thing. For example: we were not sure at that time whether earth is round or flat. Hence, just to know something at that time, someone would become considered powerful.

These days, with the current information technology, we are living in the abundance of information. If you ever want to know about virtually anything at all, just go to a library or even online, type your keyword in Google or other search engines and voila… there is your knowledge in less than a blink. Do you feel more powerful after reading it ? You should not…

There is too much information that can be seized by you on any particular topic in life. Getting the information is easy, but the more challenging task is to filter that information which one is really needed, which one is not necessary or simply just too much.

The Danger of Information Overload

As a matter a fact, we are all in the danger of “information overload” where there are too many knowledge about one particular thing, so many that some are slightly different from the other or even some are contradict each others and we are the one left in wonder – confuse and don’t know what to do. For example: you might read an article about “investing in stock market is risky” then you will also read about “investing in stock market outperform all other investment vehicle”. So, which one is true ? Both side show their evidence, you might see some real people losing money from stock market, but yet you also see some people make a handsome profit from stock market.

The real danger of “information overload” is to make us doing nothing. We will procrastinate and justify the reason because we still need more information (hence keep reading / studying / searching for the holy grail of the subject without end). Read How to Overcome Information Overload if you’re interested.

Knowledge is just Potential Power.
In-context ACTION is the POWER!

So it does not matter if you know a lot of thing, as long as you don’t make the knowledge into ACTION that knowledge will not become power. But as soon as you TAKE ACTION based on that sound knowledge, then you will immediately see the power of the knowledge being unleashed and result will come up very soon after. Buf course the knowledge itself is really crucial, without it you don’t even have the potential. But having it is not everything.

Get the result with in-context Action!

Let see an example: say you have all the knowledge about making money from stock market. But without taking the action to open an account and take that real trade, your knowledge is just simply knowledge… nothing more. But once action is taken, that knowledge become a power, you start getting real money, you start getting real experience about the market that is not mentioned or can be explained on the material that you read. The knowledge become real and via an action the knowledge then become the power that you after.

One important note here is that the action should be the one “in-context” means relevant with your goal and the context of the knowledge. For example: although you know the strategy in investing in stock market, you just simply take a gut feeling to buy or sell against your trading plan. Here, action is taken, but out of context. Even if it is successful, you will not see the realization of your knowledge into power. Simply because the action is not “in-context”.

One other simple analogy: say you have a lot of money in your hands and you are now really hungry and your goal is to have your favorite dishes for dinner. But unless you take action, you can have all the money in the world, but your goal will not be realized. Many action can be done: go to supermarket, buy all the ingredients and cook it (or have someone cook it) -or- call a restaurant to have it delivered -or- go to the restaurant and order it there, etc. All of them are what considered ‘in-context actions’ – all of them make you getting closer to your goal.

So, from now on, remember that knowledge is just potential power, in-context action is the power !

Mindset Toward Money

Since you want to be successful with investing, then you need to have the investor mindset. But at the same time, you also need to avoid the “pensioner mindset”.

We will explore these 2 totally different mindsets. The “pensioner” mindset versus the Investor mindset (or often also dubbed as “millionaire” mindset – as most of the millionaire, excluding the one just win the lottery or inherited wealth, would have this mindset). Let us begin…

The Pensioner Mindset

Now, before all the retiree in the world got angry to me, let me explain what I mean. The “pensioner mindset” refers mainly to a believe that once you reach pension age, then the government/state have to look after you. It’s sad but true, most of the pensioner will agree to that believe. How about you ?  Yes, you are retired, but you can be a “self funded retiree” not “pensioner”. Remember “pensioner” means a person that receive periodic payment from government.

No, it’s not and it should not. It is your life, so be responsible and take care of yourself. If the government may has something for you as pensioner, then be gracious and accept it just as a token of appreciation of your contribution to the country not as your main life support. If you are now a pensioner and you rely fully on your government pension, then probably only little you can do, we cannot turn back in time because more effort need to be done on previous years. Don’t you know that the population is getting bigger and life expectancy is getting longer? Hence, sooner or later, there will be no government in the world that can afford to fully funded all pensioner. The pension money will getting smaller and smaller in percentage.

Again, of course,  not all pensioner adopt this kind mindset, but most of them do. But although it’s called “pensioner” mindset, this kind of mindset is already also adopted my much younger person who does not understand (yet) the importance of millionaire mindset.

The Investor Mindset / The Millionaire Mindset

This is the mindset that see all the problem as it is, not worse than it is and not better than it is. This mindset has nothing to do with ‘positive thinking’ or some sort. It is just see everything the way everything is. No pre-judgement. The persons who have this mindset usually is very familiar with the concept risk and reward. They know how to mitigate risk to minimum. If they don’t know, they will find out until they satisfied with the knowledge. And they take full responsibility of what they did. Their decision, their money, their responsibility.

Which one is which

Let see the differences

Yes, there are a lot of scam out there, but there is also genuine good opportunity. So, if it looks good, check it out first – who knows it’s the opportunity that you always waiting for.

Sounds familiar ? There is no such guarantee in life. In matter of fact, you yourself will not be able to guarantee that you will be still alive tomorrow. That’s how risky life is. So, in every opportunity, know the risk, know the reward. If it’s still okay, just do it !

Don’t you want a financial freedom where you don’t have to work anymore (and if you are working that’s because you want to and because you have to)? That’s not going to happen unless you act now to make it happen. The secret is investing. You need to invest and invest until you have reached your goal.

Money, age, and education are the common excuses for people with “pensioner mindset” to justify about NOT doing something. Stop making excuses! Make it happen!