3 Thanksgiving-worthy Financial Attributes
Happy Thanksgiving!
As you gather with your family for Thanksgiving, it’s a good time to reflect on three financial attributes that often go unheralded. Unlike countless other topics, you should be able to talk about each of these around your Thanksgiving table without sparking controversy.
3 Underrated Attributes in Finance
1. Compound Interest
Underlying almost every aspect of personal finance and investing is the magic of compounding. Albert Einstein called compound interest “the eighth wonder of the world.” Of course, for interest and other investment earnings to compound, you have to be patient.
Compounding can’t work if you allow the allure and attraction of the short-term to get in the way. Human emotions and the behavior that follows can easily unravel your finances before compounding can take effect. It’s best to put your portfolio away in a “mental drawer” and allow compounding to work its magic.
2. Diversification
In today’s investment market, it’s easy to broadly diversify your holdings. Yet, it’s not uncommon for us to see investors who eschew diversification. If you follow that path, you’re failing to take advantage of one of the basic “free and easy” building blocks of investing.
When we talk about diversification, this means globally diversified investments. Sure, the U.S. stock market makes up about 60% of the entire value of world markets, but that means almost 40% is outside our borders.
3. Financial Independence
The third financial attribute for the Thanksgiving table is your ability to build wealth and financial independence. Just because you can build wealth doesn’t mean you will. John F. Kennedy said, “Things do not happen; things are made to happen.”
If you struggle with taking concrete steps, consider breaking these steps into smaller pieces. Developing the habit of saving and investing is vital to your long-term financial well-being.
Think Ahead to Get Ahead
When you look out into the future, the details are necessarily fuzzy. However, if you take advantage of these three financial attributes, you are giving yourself an advantage over most others. Having options and flexibility in life is increasingly important. 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. 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 for other important disclosures.