Why You Fail At Investing

By  via dumblittleman.com   Article

4 Reasons Why You Fail At Investing

You’re A Trader, Not An Investor

If you find yourself placing buy and sell trades frequently throughout the year, then you are a trader and not an investor. An investor creates a plan and chooses a basket of investments to invest in. Then she makes it a point to continuously buy more and more of these holdings. … When you trade, you are trying to take advantage of short-term market fluctuations. This is virtually impossible to do consistently. …

Victim Of Emotion

… When everyone is excited and making money, our natural tendency is to invest more to make more money. When everyone is pessimistic and the market is dropping, we want to run for the hills. These are the exact wrong things to do. You want to buy low and sell high. But even better …. I’ve found automation to be the best. Simply set up an automatic investment to run every month. If your investing is automated, you don’t allow your emotions to interfere.

Procrastinate

Even the best of us tends to procrastinate. … Think of how many people you know who haven’t started to save for retirement yet. You might even be one of them. Unlike cleaning out your files, putting off investing costs you big time. This is because you lose out on the power of compound interest. …

Trying To Get Rich Quick

… The stock market is not a place to get rich quick. … The stock market is a place to build long-term wealth. You invest consistently over time and compound interest works its magic and your money grows. Over time, you can expect an average return of roughly 8%. At that pace, you will double your money every 9 years. …

Final Thoughts

If you aren’t a successful investor, chances are it’s because of your actions and not the market. If you invest money on a consistent basis, you will come out ahead. But you need to invest regularly and give it time.”

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