What Can Derail Your Journey to Financial Security?
Sanjib Saha
1 April 2025
I have a kitchen towel that reads: “It’s almost impossible to get rich overnight, but it’s surprisingly easy to build wealth over time.” I couldn’t agree more. The formula for long-term wealth is simple—just three fundamental steps:
1. Earn a Reliable Income. Your future earning potential—also known as Human Capital—is your greatest asset when starting out. It doesn’t have to be a massive paycheck, but it should be dependable. Needless to mention, staying employable by keeping up with your field is crucial.
2. Live Below Your Means. No matter what’s the size of the paycheck, your lifestyle should be much less. Instead of spending everything (or more) for today’s wants, you must save a portion for the future.
3. Invest Wisely. Your savings should be invested according to your financial goals and investment temperament. With low-cost, simple investment options, time and compounding will do magic.
If the formula for achieving financial security is so straightforward, why do so many people fall behind—sometimes even high earners who save diligently?
The answer lies in critical missteps that can disrupt an otherwise smooth financial journey and undo years of discipline.
Charles Ellis, the legendary and insightful investor, famously compared amateur tennis players to investors: the match winner isn’t necessarily the better player, but the one who made fewer mistakes than their opponent. The winner wins by not losing points. The same applies to wealth-building—avoiding costly missteps is just as important as being a diligent saver and investor.
April is Financial Literacy Month, and at Dollar Mentor, we’re launching a series of short articles on major financial mistakes that can have lasting consequences. Whether you’re on the verge of making one—or already have—our insights can help you get back on track.
Stay tuned for our first piece!