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Knowing Yourself

August 27th, 2015 at 07:42 am

The first step in assessing your investments is not the investments themselves. You need to first assess yourself. What do I mean?

You walk into a store and there are two packages are lightbulbs. One package is $3.00 with a $3.00 rebate. The other package costs $1.50. Which one is cheaper? Seems like a trick question doesn't it? The $3.00 one right? That is true *only if you will actually send it in*. If you will not truly go to the trouble of mailing in the rebate, you just wasted $1.50.

So which package of lightbulbs costs less is not about what's marked on the package, it's about you knowing yourself. If you know you won't mail in the rebate, pay the $1.50 and be done with it.

My point is this. If you buy a stock and then you're checking on the price every hour, you probably need a less volatile investment. If you're paying for investment advice you don't need, then drop it. If you ignore your investments then make emotional decisions about what to do, then get help with them. Assessing yourself is the first, and most important step in success in your investment outcomes.

1 Responses to “Knowing Yourself”

  1. Butterscotch Says:

    This makes total sense to me. For example, I usually buy a salad for lunch each day. Sure I can buy veggies at the store and make a salad to take to work - that would be so much less expensive. But those veggies will just go bad in my crisper and get thrown out because I just don't have the time/motivation to make a salad the night before work. So I just don't buy veggies anymore.

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