For many, ‘investing’ is a word that means success, prosperity, and financial strength, but besides that, is quite foreign. Investing is something that smart, wealthy people do to make more money than the average person. It brings people to mind like bankers, real estate tycoons, Fortune 500 CEOs, and stock brokers. Unless one finds themselves employed in one of these fields, learning how to invest can seem like learning an entirely new language.
However, we all invest. We all calculate and decide which of the options laid before us are ‘worth it’ or not. Choosing where to live, what career path to follow, even which route to take to work, involve fundamental principles of investing. Listed below are three factors that are a part of every invest decision ever made, large or small:
Unlike money, you cannot get more. Time is something that is finite, limited, and not up for debate. Seeing time as more valuable than money is critical; it allows an individual to realize time is something that is always being paid, always being used. Understanding time as a fixed expenditure helps you realize that, just because something is cheap, doesn’t mean it’s the best option. A real estate investor is making a mistake if he/she buys a home that’s slightly less expensive, but requires significantly more time investment in order to improve and resell it than it’s marginally pricier counterpart.
Hundreds of seminars and thousands of books and training courses are devoted to employers and employees learning better time management practices and methods. However, the effort and energy needed to use that time effectively is often left out of the picture entirely. This is where the difference between hard work and smart work becomes evident. Often people fall into the trap of working very hard, but at the rate they’re going, they’ll burn out or have to sacrifice other resources in order to reach their goals. The ability to sustain one’s efforts is just as necessary as making the time to do those things in the first place.
Entire essays and papers could be written as to the importance of risk assessment and management (and they have been written), but the bottom line in risk is that although a certain amount is of course necessary to be accomplishing anything of worth, no sum of cash is worth large amounts of fear, doubt, and/or anxiety. Yes, take risks, but take the right ones. At some point, “high-risk investing” becomes code for gambling. Have the guts to do what you feel called to do, but recognize that most success stories aren’t lottery tickets…they’re a series of small, calculated steps that lead to measurable success.