Wealth Building Strategies: Invest in Change

I recently read an article regarding the ten richest people of all time, which accounting for inflation, only included one person, Bill Gates, from modern times. The other people on the list are mainly from the American Industrial Revolution as that period saw enormous change in society and with this change brought about immense opportunity to those fortunate to see this change and capitalize on it. The richest person in history excluding monarchs or those whose wealth would be too difficult to determine is John D. Rockefeller who increased his fortune substantially by investing in oil assets before demand for oil exploded because of the invention of the automobile. His company Standard Oil would become so dominant in the energy industry which at the time primarily produced kerosene that the US government thought it had too much market power and thus forced it to break up into pieces. Those individual pieces would become large corporations themselves including Exxon, Mobil, and Chevron. Rockefeller continued to own substantial stakes in these businesses as they grew immensely with the growing demand for energy products.

Even Bill Gates wealth was created as he foresaw change in society in that he saw the opportunity personal computers had on society and created and sold software that these devices used thus capitalizing on such growth. Thus immense wealth is usually created from the initiation of some change in society. For most of us capturing such wealth is extremely difficult but acquiring some wealth can be earned from foreseeing smaller changes in our society and investing before the masses do.

As a financial advisor I have met many people who over time acquired wealth by identifying changes that were occurring in their communities. As I work in Vancouver many of my wealthiest clients were those that acquired land in and around Vancouver in the 50's and 60's and as the population of the area expanded the value of that land grew hugely. One of my clients bought 5 acres in the Surrey area for $16,000 in the 60's and lived there until last year when he sold those 5 acres for $12 million. The reason for the high value now is the land in now zoned for multi-family or townhouse or condos and thus is worth substantially more. He made other opportune land investments from a career working in saw mills that led to his net worth of around $20 million.

Identifying changes that are occurring and investing in those assets that capitize on that change are key to building one's wealth. For myself I have invested in the stocks of many companies that have grown substantially. Westjet airlines was my first big winner which I invested in when I was around 13 years old and when it first went public and had about 12 older 737 planes flying around western Canada. I bought the stock believing that a discount airline could do well in Canada and the airline grew to a point where now it has 300+ new 737s aeroplanes and flying out of many more locations. My small investment in Westjet when I was young ended up paying for most of my costs for university and the business degree I gained from Simon Fraser University.

At the moment I have made a significant investment in my property in Ocean Park White Rock near Vancouver. The home sits on a 7,500 square feet lot and the value of the property is almost entirely in the value of the lot. I bought the home for $723,000 three years ago and the value of the property currently as assessed by the government is $1,170,000. This value though would be a conservative estimate. The strategy with owning this property is to capitalize on the lift I expect in land prices in the area as it gets rezoned for multi-family development from its current state of single home zoning. As my home sits on a corridor of land along 16th avenue this area has been selected by the municipal government for increased density given the increased need for housing in the area and thus will likely be redeveloped. When such a change occurs land prices will increase substantially. An example of this value can be found in Vancouver where a similar sized lot sold for $7 million last week.

Increasing wealth can happen a number of ways. One can save money and build it one dollar at a time, or they can wait for a relative to pass away and get it the old fashion way. An easier way though I believe is to spend time identifying changes and subsequent opportunities that exists in society and in our communities and then taking one's savings and investing in these opportunities. Growing your savings through opportune investments is the best way to grow one's wealth. Change is occurring everywhere and in some respects is accelerating thus the number of opportunities that exist is increasing.

One way to identify this change is to imagine how society will be different 10, 20, and 30 years from now. In my real estate investment I imagine the White Rock area near Vancouver will be home to many condo towers and townhouse-like developments that take advantage of the ocean view. This has already started to happen so my investment is poised to capitalize on the growth of this change as these developments expand from the town center area. With crypto currencies the future will decide which coins end up being used in society and those coins that are in demand are going to have higher values. Investing in change is a rewarding way to build wealth and if you are right can lead to substantial wealth. Good luck investing.