How To Stay Focussed On The Big Picture
This week’s lesson covers availability bias – which really means believing the information you have at hand – even if it’s not the right information to make a decision upon.
This is as true in life, as it is in investing. However, with the advent of the media and its sensationalised version of events, I do believe it has become harder to ignore this information. I remember watching the news around the time the GFC was happening and my heart rate increasing as it really felt as if the world was ending. So too, when Trump was elected.
However, it wasn’t, and it didn’t. If you believe the alarmist information at hand you may never truly invest for the long term again.
So how do you cut out the noise, and stay focussed on the bigger picture?
For a start, I believe in setting a strategy with a quality financial adviser – one that lasts the distance of your long-term financial goals. You need to understand the strategy and more importantly, stick to it.
That’s it. Don’t question it, regret it or second guess it. If you believe in the ability of that strategy to create the long term wealth you need, then hold steady.
Sounds easy right? But it’s harder than it sounds. Staying the course is like sailing the ocean – it’s never all smooth seas.
I have gotten to the point where I ignore large chunks of the news. Not because I don’t care, rather because I care a lot.
I spoke in my last blog about the lessons we need to unlearn about money to create real wealth. Well, this is a classic example.
Don’t believe what everyone is saying. Get great advice and stick to your strategy. Cutting out the noise, and deciding not to waste emotional energy on worrying about the day-to-day, is a classic lesson to unlearn.
While it’s not the only one, in this day and age, it’s a big one.
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