Step Up: Make another Understanding Money Promise
By Dian Vujovich
Earlier this week I posted the first of two Understanding Money Promise lists, as April is officially financial literacy month. As I wrote in that blog, money management triggers the use of both sides of our brains: The right side, the more intuitive and holist side; the left, the logical, analytical and objective side.
This Promise focuses on our left side and is investing focused. Like the first blog, I hope that there is a nugget or two in this one that makes sense and helps with your wealth accumulation goals.
Before reading this list and making a promise to follow through with the understandings in it, I ran across a quote this morning that fits the bill for all things money related. It’s from Canadian journalist and author, Herbert N. Casson. “If money is all that a man makes, then he will be poor. Poor in happiness and poor in all that makes life worth living.”
Good one, eh.
The Investing Understanding Money Promise:
• I understand that money is a medium of exchange that allows me to buy goods and services.
• I understand that the accumulation of money and/or wealth is a necessary goal in this life.
• I understand the investing money to make more money requires me taking on risks. And that it is always my choice as to how much risk I decide to take on or not take on.
• I understand that no one is a perfect investor and that the investment choice(s) I make may make money, loose money or not financially reward me at all.
• I understand that I will make investing mistakes throughout my investing lifetime. Some of them by my own doing, i.e., choices, others due to circumstances beyond my control.
• I understand that the prices on every investment, whether it’s one in the stock or bond markets, real estate, precious metals, commodities arena, etc. run in cycles. In other words, nothing goes up in price forever.
• I understand that the first purpose of every stock broker, investment advisor, registered investment advisor, insurance sales person, real estate agent, etc. is first and foremost to sell me something. Just as it is my goal to accumulate wealth, that is also their goal.
• I understand that those in the investment arena who rise to the top are not necessarily the best and/or the brightest, but the best sales people.
• I understand that investment scams are, always have been and always will be, a part of life. And, that it is my responsibility to never forget that fact.
• I understand that if something sounds too good to be true, it is.
• I understand that a little bit of money can go a long way and that discipline is the key component of wealth accumulation.
• I understand that it is better to live below my means than above them.
• I understand that the only investments I ought to ever make are those that I fully understand.
And here is the Understanding Money Promise: Now that my understanding of money has increased, I promise my Self that I will do a better job of managing my money today than I did yesterday and this year than I did last year.
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