| Becoming Financially Independent |
An Investment Management Company
Tutorial - Keeping It Safe
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A funny thing happens when people start accumulating money in an investment
account. Whereas they had once talked casually about taking on risk in order to
achieve a good investment return --- once even a small amount of money starts to
accumulate in their account they often become paranoid about losing any of the
money that is now sitting almost idle in their account. They become highly emotional
about their little nest egg.
In order to reach your Big Number you must be rational and eliminate the two
powerful emotions of investing: FEAR and GREED. These two emotions destroy
portfolios. In order to be successful at investing you must take advantage of the fear
and greed of others while not succumbing yourself. I'm here to help you with that.
Following are the steps I have found can tame the fear/greed factor by making sure
your assets are secure:
These concepts I've listed above must be a part of your life if you want to become
financially independent. Rather than investing with the lemmings based on destructive
emotions, the concepts listed above will allow you to invest with wisdom, confidence
and peace of mind.
This important part of the Secret Formula which we call Keeping it Safe is really
keeping your investments safe from your own emotional and spontaneous (non-logical)
decisions. My job is to help you invest based on fact, logic and wisdom.
Do you feel good about these concepts? Have you made a personal commitment to
resist water cooler investing? Then let's move on to the really fun stuff - Investing
Wisely. Click Here to move to the first section of investing - Measuring Success.
account. Whereas they had once talked casually about taking on risk in order to
achieve a good investment return --- once even a small amount of money starts to
accumulate in their account they often become paranoid about losing any of the
money that is now sitting almost idle in their account. They become highly emotional
about their little nest egg.
In order to reach your Big Number you must be rational and eliminate the two
powerful emotions of investing: FEAR and GREED. These two emotions destroy
portfolios. In order to be successful at investing you must take advantage of the fear
and greed of others while not succumbing yourself. I'm here to help you with that.
Following are the steps I have found can tame the fear/greed factor by making sure
your assets are secure:
- Get your financial house in order (as described in the previous section). Fear
often accompanies debt, over-spending, and lack of proper insurance. - Accumulate a 6-month emergency fund. A small portion of this should be actual
cash tucked in an accessible, safe location for a true emergency. Another
portion should be in "junk silver". What is junk silver? It is the standard U.S. coin
produced before 1965. These are made from 90% silver. If the financial world
as we know if were to come to an end, these would become extremely useful as a
currency due to their silver content. The remainder should be in the bank in a
savings or money market account (not a CD - which locks it up for an extended
period). Your emergency fund is set aside in case you lose your job or have
some other major surprise. Use this money instead of your credit card when the
fickle finger of fate points your way. - Get your "relationship" house in order. Huh? Aside from the personal
devastation associated with a divorce, it plays havoc with your finances.
Besides, being financially independent is 10 times more fun when you can enjoy
it with your soul-mate. - Ignore cable's business/investment news. Yep. These guys are the guru's of
fear and greed. And they're bad for your blood pressure. We can find all the
real facts we need to make wise investment decisions without being whipsawed
by their punditry. - Skip the water cooler investment tip game. Most stock market moves are a
stampede of lemmings running toward one cliff or another motivated primarily by
fear or greed. That stock tip that was just whispered in your ear is old news --
and if you act on it you will be running with the lemmings. - Use conservative numbers when forecasting your Big Number (which we did in
an earlier section) and when projecting your expected annual investment returns
(We'll get to that next.). - Invest for the long-term. When we invest in stocks, we're actually becoming part-
owners in a business. This business generates cash which goes in one of two
places. Either the cash is plowed back into the business to make it grow (and
make the value of our investment grow), or the cash is sent to you as a dividend.
My job is to closely monitor each of your businesses to make sure they remain
healthy and generate cash for you.
These concepts I've listed above must be a part of your life if you want to become
financially independent. Rather than investing with the lemmings based on destructive
emotions, the concepts listed above will allow you to invest with wisdom, confidence
and peace of mind.
This important part of the Secret Formula which we call Keeping it Safe is really
keeping your investments safe from your own emotional and spontaneous (non-logical)
decisions. My job is to help you invest based on fact, logic and wisdom.
Do you feel good about these concepts? Have you made a personal commitment to
resist water cooler investing? Then let's move on to the really fun stuff - Investing
Wisely. Click Here to move to the first section of investing - Measuring Success.
| Investing Wisely |
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| The advice contained within this website is general in nature, only for the use of FI Investments clients, and should not be relied upon without first consulting with FI Investments. |