Invest like a Dragon
Arlene Dickinson tells us how to make the most of our money.
Investing can be hard. We all wonder if it's "the right time" to invest. We all want to make a profit, but don't know where to start. Thankfully, Arlene does, and she's going to help us figure out where to put our money.
1. Don't be greedy
Everybody wants to sell when their investment is at it's peak value, but that's almost impossible. If you get greedy and wait too long in an attempt to make more money, there is a good chance that you'll lose everything. Once you've made a profit, you need to decide when to get out and stick to that plan.
We've all had those moments when we've lost money, or had no money to start with. These can be learning opportunities. Financial stress is terrible. What's important is how you face those challenges. Money is an output, not a goal. It's the result of hard work, doing something you love and are good at. When money becomes the goal, greed comes into play. Your focus becomes "I want to be rich," as opposed to "I want to do what I love," or "I want to do something good," or "I want to do the right thing." Perspective is key.
2. Always leave some money on the table
You made money. Let someone else win after you. It goes against a lot of people's instincts; you watch a stock go up and you get greedy, wanting to see it go higher. But you have to say "Wait a minute, I made some money and I didn't have to do much work. I'm going to take my money, and maybe leave an opportunity for the next person."
3. Be careful who you trust
There's not a lot of financial literacy in Canada. We tend to leave our money—the most important thing you've worked for, besides your family—with strangers. Financial advisors say they can help us, and they can, but it's up to you to make sure that you understand the language of money. Take a course, understand what's going on, and realize that any advice is coming from one person who doesn't have all the answers. At the end of the day, it's your money. If an advisor is making you feel stupid because they are using acronyms and big words, it's not you that's stupid. It's them. It's a red flag. They want you to be confused because it makes them sound smart. If you feel dumb, get out of that office. They aren't a good advisor. You wouldn't hand your baby over to a stranger without doing your research. Don't hand your money over to one, either.
4. And finally, the most valuable financial advice she's ever received
Never invest more than you can afford to lose. You aren't guaranteed a profit so always be aware of that and be aware of your risk. Whether you make $100 or $80, you're still making a profit with the $80. You will never lose money this way.