Let’s imagine for a second we were doing stationery shopping for a fictitious seven year old starting out in grade 1. The school forgot to add a stationery list when they sent the curriculum and you are doing your best last minute impression so you are not going to let us know you forgot to check.
Navigating your way out of this situation seems pretty easy bar 1 or 2 items that you’ll top up and before we can break a sweat we’ll be getting ugly drawings that mean the world to us.
Sure we’ll call a friend or two that recently took their child to school and laugh about how expensive Pritt stick is. But at no point in this process do we have a feeling that our child will end up outside in the corridor because “mommy or daddy couldn’t read a basic grocery list.” Does it mean we don’t “love our 7 year old enough to get them the best?” Definitely not. Does it mean she’ll grow up as an unorganized little mess who’ll eventually defer to society to do her thinking? I think we’ve ventured off too far now.
Shopping for your child’s future is one of the most important jobs you’ll probably have to do and will probably “wing it” well or follow the instructions well enough to get them on their way without giving a thought to how well you’re doing.
Contrast that with the financial world. All you ever wanted to do was put away your extra moneys somewhere they’ll grow and get back to doing your everyday life things. What happened?
Firstly, everything is called products, instruments and vehicles (Imagine our shopping list above saying ‘buy an adhesive tool’ instead of Pritt).
Then, everything has a profile, time horizon, appetite, exposure and all the big words that are used to describe the hand-sized red adhesive tool (yep Pritt).
You might think you’re crazy, slow, stupid etc, but trust me there’s absolutely nothing wrong with you. Your “I want to put away my extra moneys” thought is being contested in a multi-billion Randela industry. Literally everything about the industry is positioned to make you feel like You can’t do this. Like you’re too stupid for this. Kinda like if schools advertised by reminding you that you’re incapable of raising an adult. The thought is debilitating (a big word that means you’re in trouble).
Investing is scary because it has to be for the industry to remain profitable. You can’t put your money under your bed because you’ll lose it so let us take care of it for you. If you’re a little smarter, you can’t possibly decide what is likely to be the businesses of tomorrow so let us (our smart team of 26 year olds) handle it for you. Do you know what awaits you in retirement (trust me our 53 year old merc drivers do) so let us handle that for you. The list goes on and on about how they’ve been in this business from the beginning so helpless little you must leave it to them because they’re money experts.
By far the best financial hack you’ll need is to live below your means and avoid debt (and fees to a money expert). The rest pretty much involves putting your money in a basket of companies that support your everyday life and ignoring the noise.
Investing is literally just that. Picking a basket of companies that support your everyday life. You’re already doing it by buying their products, now own them.