Masters Series: Crucial Advice If You Are Getting Older... And You Can't Afford to Retire Yet

What's the average person to do? He can't open six businesses like Mark. He makes $27 an hour with no chance for overtime. He has debts. He needs a new car. He has very limited silver and gold. AND he doesn't write a newsletter for $49 a month with 100,000 subscribers, earning a cool $4.9 million per year.

Dear Joe,

Thank you for your letter. It left an impression on all of us here because we know you are not alone in your predicament.

I read a report recently that said an estimated 75% of middle-aged Americans expect to work throughout retirement because they haven't saved nearly enough money to retire on. And they're feeling scared and desperate.

But that doesn't mean you need to feel that way.

Let me address your concerns.

You are middle aged. Your net worth is meager. Your income is barely sufficient to meet expenses, and those expenses are going up. The Great Recession is looming. Economists are predicting things will get worse. What can you do?

Should you give up your dream of retiring comfortably one day? Should you accept a future of increasingly meager existence? Should you grow bitter and curse the powers that be for putting you in this situation?

Or should you take responsibility for your situation and make changes?

That last question was rhetorical, of course, but sometimes I wonder if people really do understand their options. There are things that happen in life that we can't control. But we can control the way we respond to them.

I believe – no, I am certain – that anyone who has modest intelligence and a positive attitude can become financially independent in seven years or less if he or she is willing to work enormously hard. But I also understand that when you are halfway through your life and are barely making ends meet, it seems like the only chance to become financially successful is to win the lottery (either an actual lottery or the stock market equivalent of one).

And so when you hear some rich guy from Palm Beach telling you that you can't quickly turn $25,000 into a million by investing in stocks, it may be frustrating. And when he talks about what he and his rich friends are doing – buying rental properties and starting businesses overseas – you might feel that you can't use his advice.

If you feel that way, you are wrong. You do not have to give up on your dream of being wealthy. You always have the ability to change your financial life. And you won't find a better way to do that than by being a subscriber to the Palm Beach Letter.

But it will take a bit of time and patience.

And it will require that you change some of the thoughts and feelings you have about wealth and your relationship to wealth.

The first thing you must do is to accept the fact that you alone are solely and completely responsible for your current financial situation. Before you react defensively, please read that sentence again. I didn't say you are the cause of your situation. I said you are responsible for it.

By taking responsibility for your current condition, you also assume responsibility for your future. Nobody can change your fortune but you. And nobody else will. The sooner you accept that reality, the sooner you will shed the anger and blame and begin to feel financially powerful. I'm not giving you a pep talk. I'm telling you the truth. I've done it myself, and I've coached dozens of people to do it, too. It is a simple adjustment of your thinking, but it is extremely powerful. It works instantaneously. Without it, you cannot move forward, even by a single inch.

The second thing you must do is to set realistic expectations. I have had people tell me that they don't want to make 10% or 15% on their money. They think returns like that are ho-hum. They want some incredible stock tip or some secret get-rich-quick technique. But when I hear people say that, I think, "This person will never become wealthy."

First of all, 10%-15% is a high rate of return. Warren Buffett, the most successful investor of all time and the third-richest person on the planet, has averaged 19% each year on his investments over his entire career.

Secondly, realize that the journey to millions of dollars is earned $100 at a time. You must be willing to accept this fact in order to move your financial life forward. Your financial life is like a train that has stalled, and right now, you want to be driving it at 100 miles an hour. But it can't go from zero to 100 miles an hour in no time flat. Inertia is against you. Be happy with 10 miles an hour now and then 20 and then 30. This is how wealth accumulates: gradually at first, but eventually at lightning speed.

The third thing you must do is reread my essay on the three-bucket system for managing your money. You must thoroughly understand the difference between spending, saving, and investing.

And the fourth thing you must do is to recognize that your net investible income (the amount of cash you have after spending and saving) is the single most important factor in determining how quickly you will become wealthy.

The world of wealth is governed by universal dynamics – supply, demand, wealth, greed, etc. These dynamics are as old as human civilization. Winning the wealth-building game is about recognizing and exploiting those dynamics, not denying them. Our job at the Palm Beach Letter is to highlight those dynamics on a weekly and monthly basis and then help you make smart, enriching decisions – the sort of decisions that have made men wealthy for thousands of years.

It's not fun to realize, in the midst of your life, that you haven't acquired the wealth you want. But the good news is that your past doesn't have to be a prologue, unless you allow it to. You can change your fortunes today by doing the four things I've just told you to do.

Let me be a bit more specific:

Accept responsibility for your future. Refuse to complain, criticize, or condemn. If you want us to help you achieve your goals, then trust in and follow our advice. Stop doubting it. Stop denying it. Have faith.

Give up the foolish notion that you must get rich "now." Be happy to earn 10% or 15% on your stock market investments. Realize that if you make 10% to 15%, you will be ahead of 99% of your fellow investors. Embrace the huge impact this will have on your wealth over time.

Begin to allocate your income according to the three-bucket system. With every paycheck you get, first cover your necessary expenses (bills, mortgage, etc.) Then put some money toward saving and then some money toward investing. Then and only then – after you have "paid yourself" – should you add to your "spending" account.

Stop complaining about making "only $27" an hour. That's more than a lot of people make. Be grateful you earn that much. Commit to add to that with a second income. Make an honest count of the number of hours each month you devote to television and other non-productive activities. Devote them to wealth-building instead. Cast aside the comfortable shoes of victimization. Put on the working boots of a financial hero.

If you are willing to do that, we can help you succeed. We are giving you investment recommendations that will give you realistic 10% to 15% returns (and sometimes much more.) You can buy the books I've written on how to earn more money and save more money. And we will be preparing additional reports on these subjects exclusively for our Palm Beach Letter subscribers. We are fully committed to giving our readers more valuable and realistic wealth-building advice than any other investment newsletter in the market. We have the experience and the know-how to do that. We will deliver if you do.

Now I want to address two more comments you made:

You suggest that you don't have the wherewithal to implement some of my recommendations. You suggest that buying apartments and starting businesses is something only wealthy people can do. You are dead wrong on this subject. If you are willing to work hard and smart, you can begin building a rental real estate empire with as little as a thousand dollars. And the businesses I've started can all be started for that kind of money or less. Again, I will explain how this is true in future issues and reports. If you stick around and trust us, you'll learn how you can do the same.

The other comment I want to address is the one about how much money I am making with the Palm Beach Letter. I am going to say something now that I haven't said before because I didn't think it was necessary. But since you made the comment about how much money we are raking in at the Palm Beach Letter, and about how much I'm making, I need to say it.

The Palm Beach Letter doesn't have 100,000 subscribers. It has about 30,000 subscribers. And it isn't making any money right now. It is losing money. I am 100% sure that it will start making money in about a year. It will make enough money to pay its expenses, and I hope it will one day make Tom and the rest of the Palm Beach Letter staff rich. But most of all, I hope it will make its readers rich. That is the one and only reason I am involved in this. And it is the single-most important mission of our publishing company: to make our readers rich through honest information.

As for me personally, I am not making any money from my work for the Palm Beach Letter. And I never will. I have foregone any compensation until the business is profitable. After that, every cent of the compensation I am paid as a contributor will be put directly into my charity in Nicaragua.

In other words, I'm not in this for financial compensation. I want to see if I can help thousands of individuals attain more wealth.

If I were in this for the money, I might be tempted to tell you what you want to hear so that we could sell more subscriptions. I could tell you, for example, that you can invest $25,000 in certain stocks and end up a millionaire in just a few years. But we are hoping that we can be successful publishers of good and useful information without making such promises. We want to help you by telling you the truth.

The good news is that you are only 47, not 87. You have plenty more years to increase your income and grow your net worth. Why do you assume that all is lost when, as any 87-year-old will tell you, you have a whole wonderful life ahead of you, a life that can be rich in a hundred ways?

Everybody in your situation has the same choice: you can rue your situation or you can dedicate yourself to changing it. We can show you how. For the equivalent of a tank of gas, or a dinner out, you are getting a whole year of realistic investment and wealth-building advice from me, Tom, and Paul. You have what you need to get your gravy train moving. But you are the engineer. Nobody but you can start the engine.

Signed,

Mark