What's Your Why?
People invest for different reasons. But, very rarely do I see it being about the money itself but the goal associated to it.
And this is really important and when someone contacts me and tells me they want to invest, I always ask the same question. And it throws a lot of people off because I think they expect me to start pitching the next flavour of the month, this months recommended mutual fund is x and quoting interest rates.
But I always ask, why do you want to invest?
I then usually get a stock answer; "I don’t earn any interest in the bank" or, "I’m losing to inflation" or something like that.
But that’s not usually the real reason, so I ask it again, why do want to get your money working for you? What will that mean to you? What will that enable you to do? And then we explore it together, and it’s always got a deeper underlying meaning, whether that be making sure their children have the best possible start in life unlike they did as children, or they see friends still paying a mortgage in to their 60s and they want to become mortgage free and get rid of that burden.
Or maybe they just want to be able to have enough money behind them to stop working at 60. Giving themselves the freedom enjoy the time with their grandkids and spoil them and take them on holiday twice a year. To give them the things they couldn’t give their own children when they were young.
There’s no point in investing unless you have a goal, because otherwise you just won't stick to it.
The first time something else comes up that you can tell yourself it's more important you’ll stop. Because nobody cares about zeros in their bank account, or getting X% this year. You can't physically hold it, you can't drive it in the summer.
So, before you invest anything, just take a bit of time and think why. And then ask yourself why it’s important to you. And then from 1 to 10 ask yourself how important it is.
Once you know this you’re half way there to achieving it, all that's left is to take action.
Thanks for reading,
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