Investing 101

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It’s September, the kids and grandkids are back in school, and now’s a good
time for adults to get back into learning as well.

Ever the student myself, I enjoy listening to financial podcasts which expose
me to new concepts and perspectives. I want to share some investing/money
lessons” from a podcast I recently listened to–“Standard Deviations,” by Dr.
Daniel Crosby.

He tends to focus on topics from a behavioral finance perspective. Instead of hard numbers or esoteric subjects, he concentrates on why and how human beings make the financial decisions that we do.

The episode from April 4, 2019, “The Big List of Financial Truths,” struck
such a chord with me that I had to repeat some of his investing and money
truisms verbatim. Think of this list as a primer on timeless investing lessons
that never gets old.

While I would encourage you to listen to the podcast yourself, here are a few
of my favorites:

• The Jones’ aren’t as rich or as happy as you think.
• Get rich quick, and get poor quick, are sides of the same coin.
• The more complicated the investment advice, the more expensive, and the
less useful.
• Spend less than you make—always.
• There is no such thing as job security.
• The only sure thing about stocks is there are no sure things.
• Your mortgage broker is lying to you about how much house you can afford.
• A raise in income shouldn’t mean a raise in lifestyle.
• Forecasting is for weather people.
• The truest words in financial markets are, “This too shall pass.”
• You will never, ever, feel like you have enough money.
• There is an inverse correlation between performance and time spent watching
financial news.
• If it depreciates, don’t pay interest on it.
• You don’t have to be rich to invest, but you have to invest to be rich.
• Invest in your mind, yourself, your health, and your skills first of all.
• Infrequent splurges bring the greatest happiness.
• Einstein never said that thing about compounding being the 8th wonder of
the world, but it is still magic.
• If you’re excited about an investment, it’s almost certainly a bad idea.
• Debt is a 4-letter word.

While by no means an exhaustive list, it’s hard to go wrong keeping these
investing lessons in mind.

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David Novak, CFP® is a Certified Financial Planner™ at Novak & Powell Financial Services in Pinellas County.
Please note: he is not an attorney and this article
should not be construed as one offering legal advice.
For information about investment decisions and
financial planning, contact him at (727) 451-3440.


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