Are You Using Your Head When It Comes to Investing?
Most of us have likely heard the expression “mind over matter”. At the heart of this expression is the idea that we have incredible power in our minds, and, accordingly, we are able to take on and overcome challenges that we thought were beyond us.
When it comes to investing, we often struggle with using our mind versus our heart/emotions. The result is often catastrophic when we fall into this trap.
To be effective investors, we need to do two things. First, we need to develop a stable, well-thought-out investment hypothesis – the model if you will. Second, we need to make sure that we understand the model – and its limitations – and make sure that we can stick to it through the market cycles. In other words, we need to make sure that we use our mind at all times.
The linked article shares some thoughts about the various sorts of models/approaches to investing. I would encourage you to take a look and think through how you apply the “Mind Over Model” approach to your investing. Read the article here.
- Are you satisfied with your current investment model?
Or could you use some guidance and support applying the “Mind Over Matter” approach to your current investment plan? Feel free to send us an email or give us a call. We’d love to have the opportunity to hear about your situation and your thoughts on this post. Enjoy the read and remember, it’s NOT about the money. It’s about how the money supports your goals!
At F5 Financial Planning we focus on helping individuals and families find balance between faith, friends and family, fitness and finance. We make sure that they have the financial freedom to enjoy those things in life that are important to them. And while we believe the left-brain facts and data are critical; we work with our clients to get them in the right state of mind to focus on the goals they want to achieve.
Some other posts that you might like:
- Should You Pay Off Your Mortgage?
- How Are DFA Funds Different than Index Funds?
- How Families Can Calculate Retirement Income Wants Versus Needs
- What Your Grandma Taught You About Investing
- Making Sure You Can Collect a Paycheck in Retirement