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Patience

Updated: May 26




Patience is a key element to any investment, there is a famous saying out there that state’s “Rome wasn’t built in a day” the very same can be said about our investments.
I know most of you reading want to become rich quick, want that nice home, that nice car, retired young and free to travel the world. My word of advice is to be patient, I mean we can try the lottery, the horses, or the pokies. From my experience these avenues eat away at hard earned coin and another famous saying is “the house always wins” So is it safe to say that we should move on from the idea of get rich quick schemes and move onto the real deal?
How do you think most of the rich people in the world become rich? They become rich through business opportunities, the stock market and property. The difference between the first and the latter is one has tangible assets and working capital, while the other uses tangible assets and working capital to make money from you.
Although, gambling may promise the world and underdeliver, investing promises the world, it takes time, then it delivers. So how much time are we talking? I would love to run through an analogy that breaks all logic in society.
Let’s say Matt leaves school at the age of 15 back in 2005, he goes to work for Woolworths, and he decides he wants a career in Woolworths, so Matt works very hard and decides that because he works at Woolworths he is going to invest into shares at Woolworths. Let’s say he works his way up to Management, then to a Store Manager, all by the time he is 32. Matt after all his work has Median earnings of $70,000 a year, Let’s say half goes to tax and bills and he can keep an average of $35,000 a year of Woolworths shares. If Matt bought at an average of $23, which is the rough median price of Woolworths from 2005 to 2022, he would have put 595k into Woolworths at an average price of $23, which equals roughly 26,000 shares. Now what would those shares be worth today? Woolworths is priced at $38.51 a share, so Matt’s shares will be worth a little over one million dollars. The current dividend payout for Matt is $26,000 a year.
Now you probably think this is a boring life only working at Woolworths? Well Matt over all the years collected dividends from Woolworths, through them he was able to get a deposit for a loan to buy a house, he also travelled the world multiple times, got married and in his spare time decided to finish school and study a degree he is interested in. Matt is a millionaire simply by being patient and keeping it simple.
This humble example can show how easy it is to create wealth and we find patience is key, playing the long 15–20-year game will help you make better investment decisions and live a less stressful life. Let us reflect on Warren Buffets quote to end this.
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