Step right up! Come for a ride on the Financial Rollercoaster
Just like anything in life if you don’t know where you are going it is very hard to get there. Financial goals as boring as they sound can help you ride the emotional financial rollercoaster. They will help you get to the end of the ride and have survived the slow climb to the top, edging their way to the impending drop where you lose your stomach, shut your eyes and cling on for dear life. As you ride the loop the loops and the ups and downs of the ride you get off at the end with a euphoric sense of joy and relief.
Unsplash - Dmitry Mashkin
As human beings we are pretty poor investors! We feel the lows so much more that we feel the highs which in turn makes decision making difficult. Our emotions cause us to want to buy when the market is high as it is growing and we don’t want to miss out on that growth and we want to sell when the market is low to avoid any future pain. In fact we should work the opposite of this!
When you are at the shops and you see a something on the shelf and it is full price and then you see the same thing in another shop for half the price, which one would you buy? It doesn’t take a rocket scientist to work out that you would pay the lower price. So why do we want to purchase our investments at full price and sell them in the sale?
I can hear what you are thinking, well when is a good time to buy and sell and how do we decipher the day to day ramblings of the media to establish what to do? Media seems to constantly depict the impending financial crisis that according to them is days, weeks, months away…. However it is always days, weeks or months away, a financial drop or crisis is not a matter of if rather is a matter of when. We know it will happen, history shows this, what we need is strategies on how to control our emotions and trust the process. But how do we do this?
A football team would not step into a big game without a coach with a strategy to win the game, just as a financial coach otherwise known as a financial planner will look at your the end game and provide strategies to get the win and minimise the carnage on the way.
Who is your coach? Our advisers love the long game, come and chat to us to establish your strategy.