Fear, greed and procrastination
You and every investor needs protection from three grave threats that can slay your wealth. These financial assassins of comfort and well-being can turn hard work and savings into dust. Be on your guard to protect against them.
This post is Part 1 in the White Top View Series, Mind Game. The Mind Game series discusses emotions and psychological aspects of investing. Links to all six parts of the White Top View Series, Mind Game are at the end of this post. Click any link to read that post.
The Assassins of Wealth
To protect ourselves we need awareness of these assassins. Then we need a strategy to deal with them. Such an essential strategy improves the success of any investor.
Fear is powerful and paralyzing! Fear can do terrible things to your wealth. It can paralyze victims into taking no action or acting in panic by doing the wrong thing. When the awful fangs of fear seize our mind, all useful thought stops. Disaster looms! Fear can escalate a poor, negative or bad situation from being merely unpleasant, into a financially devastating disaster. Fear can part us from significant sums of money.
Knowledge is the defence. You can learn. Do so.
When greed kidnaps our soul, we can do absolutely crazy things and make completely irrational decisions. Greed consumes relationships, homes, careers, businesses and lifetimes of savings. We need a defense in place to avoid biting this tempting but disastrous lure. Every experienced financial advisor knows sad tales of bad decisions made while being seduced by the temptress of greed.
The investing game is long. It is 30 years to half-time! Shortcuts undermine your future. Take the time to learn and to build a solid fortune.
Procrastination, equivocation, indecision, indisposition, irresoluteness and a host of other 25¢ words apply. All rob wealth! Failure to act in a timely fashion, can mean failure to seize opportunity or failure to avoid a foreseeable loss.
Not acting and making decisions or avoiding making timely decisions through neglect or foolish dithering regularly destroys much wealth. More wealth and opportunity is lost by procrastination and poor decision timing than any other of the many flaws in our makeup. Never be a victim of indecision.
Decide to be a decider. Yes, George was right! It is a word. Be a decider.
Good Defense Saves the Day
There are excellent ways to keep those portfolio killers at bay. And the best news; we can put up a solid defense that keeps them from our door.
3 Pillars of defense against wealth assassins
If you have read this far, you are aware. Now being aware you can take the necessary steps required to guard against these assassins. Enough said.
Being open to educating yourself about investing and markets through some minimal effort will do the trick. That will teach you all you need to know to keep ahead of these threats to wealth. Keep your learning and growing going forever.
This is the key one. Commit to yourself. Commit to building your wealth. Commit to making timely decisions. The best time to do that is now.
Commit to financial security, retirement independence, freedom and if you wish to keep at it, financial wealth. It is a choice that you can make.
Now is always the best time. That is not suggesting you rush decisions or that you have to act on information, even when waiting is better. It is saying, be in a state of awareness. Participate, be an investor, be a thinker.
Professional Help or Individual Account
Managing your own portfolio or working with a financial advisor requires participation, if you want the best outcome. No advisor can accept responsibility for your dumb, impulsive, or inappropriate decisions.
If you are running your own portfolio, you certainly need to pay attention. Not every tick of the market, unless you are an aggressive short-term trader. However, depending on your strategy and holdings, managing many portfolios needs no more than day by day or week by week monitoring.
Buying an autopilot portfolio fund or attempting to run your own on autopilot, guarantees mediocre results. Save your money and time.
If that level of performance satisfies you, simply buy an index ETF and put it in a self managed account.That will give you low costs and low performance, all wrapped up in one tidy cheap mediocre package. Why pay more for mediocre?
That is a choice. Should you make that choice you have to accept that you are choosing to give up significant opportunity. There is nothing wrong with that. Just make certain that you are making an informed decision.
Taking basic daily or weekly action can dramatically improve your results. It can do so while keeping your portfolio safe and allowing you to enjoy investing even as you continually build financial security, retirement independence and have the freedom to make choices.
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These discussions and information intend to help you better understand markets and investing. I am not a financial or investment advisor; opinions are for informational and educational purposes only and are not intended as investment advice. For syndication of the site or blog, please contact info@WhiteTopInvestor.com.
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Links to the White Top View Series, Mind Game