Investing Entertainment: Bad Idea

Investing Entertainment: Bad Idea

Greetings, Carl here.

One of the biggest mistakes we make with our money is confusing investing with entertainment.

Somewhere along the line, investing has become one of America’s favorite spectator sports.

On social media, in your newsfeed, or at the dentist’s office—it seems like everywhere you look, someone is talking about finding the next hot stock, mutual fund, or alternative investment—from cryptocurrency and tech funds to startups and beyond.

Problem is, smart investing actually has very little to do with the kind of bold, swift actions people tend to yell about on the financial pornography networks. Smart investing is about as exciting as watching grass grow.

The idea that investing is fun and entertaining can lead us to make costly mistakes. Despite knowing at some level that market timing, stock picking, and day trading are hazardous to our wealth, so many of us end up engaging in that kind of behavior.

Sure, investing can be fun. But bear markets serve as a painful reminder that it's not always fun. This isn't Monopoly we're playing. It's real life. We're dealing with real money and real goals. And by confusing investing and entertainment, you almost always end up with bad results.

At some point, we need to take a deep breath and ask ourselves a question: Am I investing to meet my most important financial goals, or am I investing as a form of entertainment?

Hint: For almost all of us, it can’t be both.

-Carl

P.S. You under-priced your services. It’s not your fault, most financial advisors do. There comes a point when you need to raise fees to run your firm sustainably. How do you do that? Join our April workshop at The Society of Advice to learn how to talk about your fees and raise them so they reflect the value you deliver as an advisor. This is a one-time workshop. Start your free trial of The Society of Advice and get access to our April workshop on how to talk about and raise your fees!

Ryan Johnson, BFA?

Financial Planner for people in their 30s & 40s.

7 个月

I'm ok with investing in entertainment, but see lots of issues with investing AS entertainment ??

Lyle Sussman

professor at university of Louisville

7 个月

Personal story: A few years ago my wife and I planned a trip to "The city that never sleeps. " We were looking forward to seeing/experiencing the Broadway Hit, "Hamilton". The going price for 2 tickets at that time was $800.00, a price that could then only be guaranteed for the next 24 hrs. After 30 minutes of soul-searching discussions about "worth", "once in a lifetime experience", and "outrageous price", we decided against "investing" in that "entertainment." Even though we could afford to pay that price, my wife and I never regretted passing on that "get these tickets while they're hot" pricing. Another life lesson about tradeoffs.

要查看或添加评论,请登录

Carl Richards的更多文章

  • Confirmation Bias Prevention

    Confirmation Bias Prevention

    Greetings, Carl here. We make a choice and then gather evidence to back it up, ignoring anything that challenges us.

    1 条评论
  • You've Been In Your Body All Week

    You've Been In Your Body All Week

    Greetings, Carl here. Last week, my wife said, "You’ve been in your body, not in your head.

    1 条评论
  • In Over My Head

    In Over My Head

    Greetings, Carl here. I did something I’ve been avoiding for 20 years: a wilderness first responder course.

  • Experts Make Fatal Flaws

    Experts Make Fatal Flaws

    Greetings, Carl here. Here's something wild: Experts—the people who should know better—make fatal mistakes that ruin…

    1 条评论
  • What Are You Willing to Sell for a Monthly Salary?

    What Are You Willing to Sell for a Monthly Salary?

    Greetings, Carl here. I’ve been thinking about something Nassim Taleb said that really stuck with me: “The three most…

    7 条评论
  • Directing Attention

    Directing Attention

    Greetings, Carl here. Investing your attention is hard, but it’s a skill worth practicing.

    2 条评论
  • Don't Get in the Way of Magic

    Don't Get in the Way of Magic

    Greetings, Carl here. There’s magic out there.

  • How Do You Know if You're Spending Too Much?

    How Do You Know if You're Spending Too Much?

    Greetings, Carl here. "Sufficient for our needs” sounds simple, but it’s tricky.

  • The Relative Nature of Enough

    The Relative Nature of Enough

    Greetings, Carl here. I want to talk about the idea of enough.

  • The Generous Act of Attention

    The Generous Act of Attention

    Greetings, Carl here. "Attention is the rarest and purest form of generosity.

社区洞察

其他会员也浏览了