How to Become a More Patient Investor
It’s no secret that in every corner of modern life, patience is in short supply. If you find yourself becoming impatient with the pace of progress in your financial life, pause and give some thought to the root cause.
Is your impatience driven by the ever changing investment themes of the day or are you trying to “catch-up” for years of undersaving? Either way, achieving some element of patience in your financial life is a process that requires discipline and focus.
If you’re not on track for meeting your most important financial goals, overreaching for higher risk strategies may at first appear to make sense. But what if a more risky approach backfires and you find yourself even further behind?
Why Patient Investing Matters for Long-Term Success
The process of embracing patience can be difficult because of the human tendency to focus on the immediate instead of the long-term. Sometimes just changing your mindset can help in reaching the destination you desire. A change in your perspective about your financial life can help bring about change in your behavior.
Shifting Your Mindset Toward Patient Investing
Sometimes an honest reevaluation of your financial life goals and priorities can help embed patience into your money decisions. Consider reframing how you think about “shiny objects” that mostly distract you from your longer term aspirations. Visualize where you are now and where you want to be financially in 5,10, or 20 years in the future.
Avoiding Emotional Decisions in Patient Investing
There’s almost always some crisis unfolding somewhere in the world. The confusion and chaos of current events can push you toward immediate action…a desire to do something. This is the very foundation of impatience.
Things in your life and within the markets will sometimes go “bump in the night.” Strive to put your focus on regular financial reviews instead of watching the markets every minute of the day.
Patient Investing and the Power of Compounding
Accomplishing your long-term planning goals requires patience. Famed investor Warren Buffett says,”The stock market is a device for transferring money from the impatient to the patient.”
When you’re impatient with your investments it’s easy to run afoul of two very important investing principles: compounding and costs. If you move in and out of the market frequently, you might miss the positive impact of compounding. Also, trading usually entails costs that eat into your long-term wealth accumulation.
How to Practice Patient Investing in Your Financial Plan
Changing your mindset, your approach, and your focus are the challenges to becoming a more patient investor. The benefit of patience is that it utilizes the element of time. For the most part, wealth is accumulated over time. Put time on your side. Start there. Ready for a real conversation?
Disclosure
Apollon Wealth Management, LLC dba J.E. Wilson (Apollon) is an investment advisor registered with the SEC. This document is intended for the exclusive use of clients or prospective clients of Apollon. Any dissemination or distribution is strictly prohibited. Information provided in this document is for informational and/or educational purposes only and is not, in any way, to be considered investment advice nor a recommendation of any investment product or service. Investing involves risk, and while remaining invested can support long-term goals, it does not guarantee a profit or protect against losses. Advice may only be provided after entering into an engagement agreement and providing Apollon with all requested background and account information. Please visit our website https://apollonwealthmanagement.com for other important disclosures.