On Saturday, Your Survival Guy was talking with Dick Young when he asked, “Survival Guy, how many times have you heard me say how “well” my accounts performed in any given year?”
“Never,” I said. “You don’t talk about percentage returns.”
“That’s right,” he said. “I don’t give any time to the subject. What I do give time to is understanding the importance of working to save money and investing to keep it. And yes, over time, if you’re a Prudent Man, so to speak, compound interest will do the heavy lifting. I’m living proof that diversification and patience built on a foundation of compound interest works. I invest in areas I’m comfortable with and let interest on interest do the heavy lifting. Tell your clients that.”
“I will,” I said.
Remember, it’s not necessarily what you invest in but how you invest. In other words, are you invested in a way that makes you comfortable enough where you can invest in good times and bad? No one knows how long either one lasts, but having a plan you can stick with will most likely help you weather both with the peace of mind and comfort you deserve.
Action Line: Run your finger along the efficient frontier to understand risk vs. reward. It’s been my experience that investors realize after the fact that their risk tolerance was, in fact, an intolerance. When you want to talk about your investment plan, let’s talk. Email me at ejsmith@yoursurvivalguy.com.
Originally posted on Your Survival Guy.