HOW TO FIND FINANCIAL CERTAINTY IN UNCERTAIN TIMES?

Many of the worlds best money masters advise us that you don’t have to predict the future to win the money game.?It’s a really important point to remember.

The simple fact is both you and I can’t control where the economy is headed and whether the stock market will soar or plunge. We have no control over the world banking system, Government Policy, the world stock-markets or our own local markets either. The winners of the money game know that?they?can’t control the future.

Here’s what you?do?have to do: You have to focus on what you?can?control, not on what you can’t.?

Seriously how often do you hear financial predictions that quite often end up being so wrong because the world is just too complex and fast changing for anybody to foresee the future. Money winners focus so intently on what they?can?control that they’ll thrive no matter what happens to the economy or the financial markets.

Control what you can control. That’s the key.

Praying and hoping for financial success is not your answer.

You need the right financial knowledge, the tools, the skills, the expertise and the?strategies that will empower you to achieve long term prosperity and abundance.?

Build your TEAM around you in areas you are lacking.

I firmly believe financial education is the key to your personal financial success, but remember it’s a journey, not a race. It’s a destination!

You need to learn the rules of the financial game, who the players are, what their agendas are and how you can win. This knowledge can set you free.

You may know a bit about investing however you might be wondering isn’t it just a simple matter of buying and holding for the long term?

Well yes and no. Over 20-30 years there will be many years of market volatility, stock market crashes, property fluctuations, interest rate rises and falls, unemployment, economy collapses, world events and on and on it goes. It’s never a simple straight path.

Financial successes like multi billionaires Ray Dalio & Warren Buffett don’t go out to beat the markets.

The problem with focusing on world markets, volatility, doom and gloom or boom markets and money-making opportunities comes down to one thing… human behaviour. Your reaction to the markets and media hysteria!!

I can tell you this: most people find it really hard to sit tight and stay in the market when everything is going crazy, stocks are crashing & prices are falling. People panic and their buy and hold strategy goes out the window for most Aussie investors.

If you have nerves of steel that’s great. But if you want to know how the majority of people behave under stress, just check out a study I came across in Tony Robbins book Unshakeable by Dalbar, one of the financial industry’s leading research firms.

Dalbar revealed the gigantic discrepancy between the market’s returns and the returns that people actually achieve. They found the S&P 500 returned an average of 10.28% a year from 1985 to 2015. At this rate, your money doubles every seven years. Thanks to the power of compounding, you’d have made a killing just by owning an index fund that tracked the S&P 500 over those 30 years.

Let’s say you’d invested $50,000 in 1985. How much would it have been worth by 2015? The answer: $941,613.61. That’s right. Almost a million bucks!

But while the market returned 10.28% per year, Dalbar found that the average investor made only 3.66% a year over those three decades!?

At that rate, your money doubles only every 20 years. The result?

Instead of that million-dollar windfall, you ended up with only $146,996.?

What explains this massive performance gap? In part, it’s the disastrous effect of excessive management fees, inflated brokerage commissions and other hidden costs.

But there’s another reason this happens and it’s driven by human emotion.

We are highly intelligent yet very emotional creatures and our emotions such as fear and greed can lead us into doing some very stupid things when it comes to money.

For example, “People who react emotionally tend to put money into the market and take money out of the market exactly the wrong time.”

People tend to buy real estate at the wrong time or wrong location then tend to sell at the wrong time as well (I have made that mistake myself and it’s cost me hundreds of thousands of dollars. I’ve also made the right time to buy and sell real estate which made me big windfalls as well). At the time these were very valuable learning lessons for me that now serve me well.

Look at what happened in Australia in 2020 when Covid arrived.

Hundreds of thousands of working people rushed into to their superannuation retirement funds and withdrew $10,000 in the first grab then foolishly took another $10,000 out in their second grab.

Two things happened here. Over the next 12 -18 months the stock-markets fluctuated but eventually returned some significant gains of between 12% - 20%

People who withdrew money lost money?as their money was not back in the market getting those gains as they arose and the bigger mistake here is they also have lost $20,000 that could have compounded over the next 20-30 years.

For example $20,000 compounding at 8% over 20 years will give you a return of $98,536

That’s $98,536 that could have been compounding with the remaining money in their superannuation accounts.

One poor decision to take out $10,000 could have cost people over $100,000 plus towards their retirements!

A lot of people moved their entire retirement funds into cash and they also missed out on the rising market gains during the same periods.

Crazy stuff right?

On top of that the banks in Australia allowed people to defer their home loan repayments for 6 months and many people believed this was a free holiday. How wrong were they?

You still had to make the 6 months repayments and you still had to pay the interest accrued so over time you are losing money again!!

You have to get your mindset right and keep your emotions in check to win the money game!

Get clear on what your main goal is when it comes to money??

Is it really?money?you’re chasing, or is it the?feelings?that you think money can create??

Many people believe that when they accumulate enough money they will finally feel free, secure, excited, happy and joyful.

You don’t need to wait for “the money” to be happy right now.

I believe you have to live and enjoy the journey!

Here’s 5 things you can do to create your own financial certainty…

1.????Focus on what you can control.

2.????Be super grateful for everything you have.

3.????Always keep a cash buffer behind you.

4.????Develop a mindset that doesn’t get rattled when the economy starts to shake or explode.

5.????Keep your emotions in check, hold your nerve, look to the long term but stay grounded in the present.