Prioritizing money in life does not mean sacrificing your values
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Editor’s note: Of course, money is important. We need money to build a financial safety net, ensure basic survival, and live a minimally comfortable life in the unpredictable future. Some people may tell you that wealth is not the only thing you should pursue, but giving priority to money does not mean sacrificing your values. The key is not to fall into the trap of insatiable materialism. The author provides 7 suggestions related to investment in the text, I hope it is useful to you. This article is translated from medium, article author Roger A. Reid, original title 7 Guidelines For Managing Your Financial Priorities.
Every time I ask people what is the last thing they regret in life, the answers I get are usually expected:
“I hope I have more time with my family.”
“I prematurely gave up something that is important to me, and now I am thinking …”
“I hope I can cherish my health.”
Then … they will talk about money.
What I want to explain is that these are not palliative confessions, but the reactions of those who are in the fourth stage of life-a part of active seniors are still very concerned about the responsibilities and obligations of life.
A lot of people want to be more frugal when they are young, or start investing earlier, or not be fooled so easily when they are persuaded to buy a $ 10,000 collection-because of the phrase “value Will definitely double within a year “!
So what is the overwhelming consensus?
No matter what career goal we are pursuing-whether as an ordinary employee or entrepreneur-as time goes by, we need to establish a financial safety net so that we do n’t have to always worry about how to pay the bills and Feeding the family.
Yes, until I have the point of view held by some people, they will tell you that a successful life is not just about gaining wealth. But the premise of this assumption is that money-perhaps not a fortune, but at least the minimum amount that can pay for food, shelter, clothing, and transportation-is a basic necessity of life.
When you have money, you can easily put the money in a secondary position. A friend of mine suggested that an attitude of indifference to money is often the result of making a fortune in the stock market, just like it is an unconsidered excuse to cover up your bankruptcy.
Prioritizing money in your life does not mean sacrificing your values.
Many popular suggestions will tell you to live a more balanced life—reducing our obsession with wealth and redirecting our attention to the often overlooked aspects of health, spiritual awareness, and interpersonal relationships .
Although this makes sense in theory, its premise is that it is assumed that the passion for money is driven by an unhealthy desire for material wealth, conspicuous consumption or total greed.
But what if our motivation for using money is out of need—to establish a financial safety net, to ensure basic survival, and to ensure that we live a minimally comfortable life in the unpredictable future?
The key is not to confuse realistic ambition with insatiable materialism.
So, although all the advice tells us to strike a balance between money and other aspects of life, we ca n’t escape this fact:
For most of us, money does matter.
What is the primary reason for putting financial goals first?
No one wants to work forever, they just have to work.
However, I can see it every day-men and women in their 70s working as cashiers in supermarkets or shop assistants in hypermarkets.
Yes, a few people still work hourly because they like it, but this is not the life of most people.
I’m curious about what motivates them to continue working, so I often ask older employees if they like their job or how long they have worked there. Without exception, the topic always shifts to why they are still working full-time at an older age.
The answer will never change: “I need money, social security alone is not enough.”
Many of these people were previously engaged in professional work and had relatively high incomes-until they reached retirement age. Due to social prejudice and age discrimination, they were “encouraged” to leave employers and businesses.
Others have invested a lot of money in real estate or securities, and lost most of their savings before retirement, which forced them to return to work.
I met someone who has been a pilot in a large airline for more than 30 years and has been looking forward to enjoying various hobbies, cruise travel and spending time with his wife in his “golden years” after retirement . After discovering that his retirement fund was completely exhausted, he had to help customers at the local Home Depot. Due to ageUnable to continue working as a commercial pilot, he found his skills had fallen to the level of entry-level employees who were only one-third of his age.
So what I want to say is:
As we grow older, our emphasis on money and its absolute value (the purpose of our ultimate possession of money) has also changed.
When we were young, we tended to believe that money will always come, and we still have enough time to make money. We also believe that over time, our income will increase, which makes it easy for us to generate the idea of investing seriously in the future.
But nothing is certain, including our career or income potential.
No matter how you live, you should devote some of your income to saving and investing. Few companies now offer traditional retirement benefit plans that were common 30 years ago.
There are also many “retired” employees who, after working for three or forty years, still expect to receive a retirement check every month, only to find that the company ’s welfare fund is either underfunded-the income is much lower Expectation-either bankruptcy or nothing.
For them, retirement means doing a full-time job to maintain their livelihoods.
I am not a financial advisor, stockbroker or professional investment advisor. The following 7 suggestions are based on my personal experience-what I am doing right, and if time goes back, what changes will I make based on the lessons learned.
Maybe you will find them useful, and maybe they are also useless, which varies from person to person.
1. Long-term plan
If you want to invest in securities, do not let the short-term fluctuations in the market prevent you from making clear and objective assessments and decisions.
This applies to both buyers and sellers. When calculating the impact of market cycles, your age is the most important determinant. The gains and losses in a 5 or 10 year cycle are not very important for people in their 20s. However, a 65-year-old should definitely pay attention to market timing and include this parameter in their “exit strategy”.
If you are worried about market volatility, then you may wish to refer to the following two basic principles when making decisions:
When you buy shares in a new company or an unconfirmed company, learn to stop losses in time.
After the stock price doubled, half of the stock was sold.
2. Diversified investment
If you have reached the age of retirement, you may want to invest yourJin bets on both conservative and high-risk investments.
But the main purpose of investment diversification is to balance the risks and returns between different industries or product types, and to prevent serious losses to your portfolio when a single industry encounters a crash (such as the 2008-2011 real estate market).
Depending on your goals (and your age), you may want to consider a portfolio that can provide income and equity accumulation. For example, I often see a combination of blue chip stocks and real estate leasing.
3. Do n’t ignore the 401K plan
If your company offers a 401K plan, you can put as much money as you can.
My investment in 401K accounts for 12% of my income, of which 6% is paid by the company. I know a few people who just got a comfortable retirement income by making good use of the 401K provided by the company.
4. Adhere to established principles
If you have a professional investment consultant, take this as your mantra.
In any case, you should not invest in anything that has no intrinsic value or residual value.
Reliable and guaranteed return alternative investments that are far from being sold by salespeople. By alternative, I mean art, rare coins, books, guns, antiques, and anything that requires veterinary care.
I know that some of you may collect coins or stamps, or have a porcelain cabinet full of plates and statues. But unless you are an expert in this field and have extensive trading experience in these specific wholesale markets, this can only be a hobby, not an investment, and you should control your buying behavior accordingly.
5. Avoid investments that you do not understand or do not have “core value”
So many years ago, the so-called “tax havens” were sold as investments. They use loopholes in tax laws to increase income. But in the end, most of these junk gadgets were eliminated by the market.
I have seen privately managed funds invest in commercial real estate, rare coins, second-hand jeans, a men ’s magazine, restaurants, art prints, rental train carriages, and speculatively built custom homes.
In my experience, those who “invest” in these companies have lost money.
6. Clearly understand how to calculate and evaluate fees, commissions and other expenses
For example, if you decide to invest in stocks or mutual funds, you must be fully informed of all fees, including account maintenance and termination fees.
If a broker or sales representative talks, or tells you that this is the minimum requirement or standard in the industry, immediately find another broker.
7. Do n’t confuse passive investment with participation in business operations
These plans are often described as an “open source” method, usually by asking for purchases of inventory, inventory, or samples.
If you have to recruit others, sell, sell or support products or companies to achieve or increase your shareholding ratio, you are not actually investing, no matter what the beautiful brochure given to you by the person who lied to you Words are so tempting.
Written at the end
That’s the case, these simple rules can help you build your own investment plan.
The most important thing is to start saving now. The sooner you start managing money, the faster your money will grow.
Do you want another option? I wish you good luck, I hope you can still apply for a cashier in the supermarket after retirement.
Translator: Xitang