Ready, Steady, Invest!

“To send the common people to war untrained is to throw them away.” – Confucius

With the economy in such a state, it’s hard to know who to listen to, especially when it comes to something as important as managing your money. And yet now seems like the perfect time to take advantage of so many opportunities. A great place to start would be Rich Dad’s Guide to Investing by Robert Kiyosaki. In it, he suggests suggest the following:

1. Build a team.

Find a financial adviser, stock broker, and insurance agent who have your best interests at heart and make sure you pay them well. Ultimately, it’s about finding people wherever you can to help your knowledge grow. Ensuring they’re well paid (ideally based on performance or return) is the best way to get your interests aligned.

2. Create a plan.

Draft a very personal plan for your financial future. Make sure you have multiple investment vehicles, asset allocation you are prepared to stick to (depending on risk aversion, tax bracket, and age), and an exit strategy. Find a simple formula that works and stick to it even if your advisors (or the times) change. Keep learning and improving as the plan reveals what you need to know along the way. Don’t start investing until you have a written and signed plan you can show to someone else!

3. Have the right mindset.

Firstly, make sure you have confidence, patience, and are neutral to winning and losing because both are part of the game. Secondly, make sure you are comfortable losing everything you invest. And finally, make sure you are aspiring to realistic performance and nothing extraordinary. If the global economic adjustment has taught us anything, it’s that even the pros get it wrong.