Ultra-Wealthy Individuals Do NOT Make These 6 Mistakes When It Comes To Investing

If your net worth is at least thirty million dollars, you are apart of an very small, super wealthy group of people known as UHNWIs - ultra high-net-worth individuals. Your net worth can be gathered from shares in public or private companies, personal investments like art, airplanes, or automobiles; or investments in real estate.

Since you're reading this article, I'd be willing to bet you are NOT in the UHNWI club. I'm right there with you. Actually, 99% of the world population isn't in that club. 1% of the world's population has the rest of us scratching our heads trying to figure out how to get in that club.

They didn't strike it rich through practicing secret successful investment strategies. They simply know which investment mistakes you should never commit. It's all about making your money work for you and avoiding losing it in big chunks. Let's break it down:

Mistake #1 - Sticking to only US and EU Investing Opportunities

This typically feels like a safe route to take: two well developed economies. But the EU has recently turned into a high risk market, forcing successful investors to look beyond Europe and the United States.

UHNWIs look for investment opportunities in new and developing markets. This includes Chile, Indonesia, and Singapore. Do these markets fit your personal portfolio and your style of investing? They could very well be worth looking into.

Mistake #2 - Avoiding Investment In Physical Assets

Why is it when we speak of investing, we go straight for stocks and bonds? The ultra rich invest in a number of assets, but especially in real estate (private and commercial), artwork, and gold. These types of investments tend to have a higher price of entry with a lower rate of liquidity but when they aren't directly related to the market, they aren't affected when the market takes a hit - resulting in long term payoffs.

Mistake #3 - Using Public Markets for 100% of Your Investing

Real, impressive amounts of money don't come from investing in public markets. Most members of the ultra-wealthy club earned their first cash hauls in private (and often direct) business ownership. Mitt Romney grew his IRA - through private equity investing - to over $100,000,000.

Mistake #4 - Trying To Do What Everyone Else Is Doing

Competing with your peers by trying to copy or top their strategies for investing will not grow your bank account. Long before making an investment, UHNWIs have already planned out their long term strategies and investment goals. Their goals fuel their investment decision making. They don't compare their bank accounts and physical possessions to their peers by making gaudy purchases. They take the money they could spend on a lexus and invest it into the market or in other physical investments.

Mistake #5 - Neglecting to Rebalance Their Personal Investment Portfolio

You have to regularly rebalance your personal investment portfolio to make sure it is proportionally allocated and adequately diversified. It's very tough to reach your financial goals if your portfolio skews too far off track.

There are two ways to go about rebalancing: pay someone to do it or do it yourself. Rebalance daily, weekly, monthly, or quarterly depending on your investments. If you're rebalancing yearly, that's probably not going to cut it for the UHNWI club.

Mistake #6 - Creating a Financial Strategy Without a Savings Plan

The ultra-wealthy know that there are two sides to investing: investing widely and saving wisely. Try focusing on increasing your cash flow while reducing your cash outflow. Living beneath your means from the very beginning it the. ultimate. way. to become wealthy.