The Fire Investor

I recently read Robert Kiyosaki’s book titled Rich Dad’s guide to becoming rich and he stated in that book that in order to become rich and wealthy we need to be a good gambler and a good banker. What he means is that you have to be a good saver and also be able to take calculated risks. In order to have money to invest you have to live below your means and save the surplus. Then you have to identify your risk tolerance and pick an asset in which to invest in after of course having an emergency fund. You also have to be in position where you can afford to lose money so that it won’t set you back financially. You have to be in a position to take risks. That’s the whole idea behind being a good banker and setting up an emergency fund. It takes balance.

Sometimes it’s hard to do what’s important and what matters as it pertains to investing. It’s not the return on your investments that ultimately matter, but its if you’re able to stay the course in order to get that long term compounding interest that will double and even quadruple your investments every 10 years or so. You see, when it pertains to investing, the proverbial chicken does actually come before the egg; and if you’re after that golden egg then staying the course is how to get your hands on that golden egg laying chicken.

Continue reading “Investing 101 for the buy and hold investor”

I recently wrote about having a reasonable investing plan and how important it is to have one, but It’s even more important to have an investment plan during times of market volatility than in bull markets. If not you may be investing speculatively and be unaware of it. Benjamin Graham once said The greatest danger investors face is acquiring speculative habits without realizing they have done so. This can happen so easily to many of us. The reasoning is simple. Because you see every battle is won before it’s fought and if you fail to plan then you will essentially plan to fail.

Continue reading “How to Avoid Speculative Investing”

Investing in stocks is like farming. There is a time to reap and then there’s a time to sow. It’s a great hobby to partake in if you have patience. That’s why the stock market is not the best place to keep your emergency funds. It’s the same reason why your personal home should not be viewed as an investment. The housing market has ups and downs just like the stock market. When the housing market is hot then that’s the time to sell high and when it’s low that’s the time to buy at a bargain price, but life is not going to wait until the housing market is hot for that promotion to occur that’s going to require you to move across the country or for some tragedy to befall your love ones that will require you to move closer to home help take care of your family.