I believe, the first step towards knowing what you want is knowing what you do not want. While this certainly might not apply to everything, it applies to money matters and maybe relationships.
How are you doing? Hope your week started on a great note.
Have you realized anxious people are more likely to fall for a scam? Often, it’s because of unhealthy competition and the haste to be wealthy overnight. True wealth is not created in a day. If you fail to see and work towards the long-term goal, you’ve missed the whole point. Quit focusing on “blowing” overnight.
I remember some time ago, I wanted to launch an asset management company and I ran a survey asking people different questions as it pertained to risk appetite, investment tenor, contribution, investment class, rates, and returns. More than half of the correspondents wanted 30% or more return on their investment in one year. While this is achievable, it is not sustainable. Your first goal should be the assurance that your capital is safe and secured. If I am highly exposed to risk and uncertainty, what is my exposure level and how can I balance it?
I know we have another category of people who have no idea what they want. “Whatever will be, will be” is their slogan. All vibes and zero financial knowledge. Funnily, they claim they will learn how to manage their financial resources when they have money. It’s equivalent to a doctor telling you, she will learn on the job. If you are part of this mailing list, I believe you are not in this category.
One important lesson I learned last year was, that there is always another time to invest. I cannot be rushed into an investment. I conduct my due diligence before investing (and by due diligence, I don’t refer to word of mouth) and if by chance, I am not done with my analysis and the offer is gone, we move. Those who invested in Apple shares 10 years ago differ from those who invested in cryptocurrency 4 years ago. Everybody is making money. I do not go with the flow. Fear of missing out doesn’t live here.
“Anxiety is like a rocking chair. It gives you something to do, but it doesn't get you very far.” Jodi Picoult.
Say after me, “when next there is an opportunity to invest, I won’t enter it anxiously. From today, I do not chase arbitrary returns. I will not invest because other people are investing in it. I invest because I have done proper due diligence and I understand what kind of investor I am”. Hope you said it loud and clear.
I am starting a series of corporate stories this week. It will focus on the rise, fall, merger, and acquisition of startups and large corporates. But in between all of this, I will share random thoughts and nuggets on personal finance.
Cheers to a profitable week,
TL