{"id":1779,"date":"2022-09-28T21:56:45","date_gmt":"2022-09-28T21:56:45","guid":{"rendered":"https:\/\/prendergast.net\/?p=1779"},"modified":"2022-09-28T21:56:45","modified_gmt":"2022-09-28T21:56:45","slug":"three-wise-investing-principles-for-the-current-times","status":"publish","type":"post","link":"https:\/\/prendergast.net\/?p=1779","title":{"rendered":"Three Wise Investing Principles For The Current Times"},"content":{"rendered":"

Three Wise Investing Principles For The Current Times<\/span><\/span><\/strong><\/span><\/h1>\n

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This article explores the importance of an investment portfolio and the process of setting it up. <\/span><\/span><\/p>\n

Why Consider an Investment Portfolio?<\/span><\/span><\/strong><\/h2>\n

Perhaps one of the hardest lessons of these last two years is the realization that you can be great at what you do, and yet see all your efforts go up in smoke during economic turmoil. <\/span><\/span>We live in a rapidly changing world and no industry is immune from the potential fallout of economic events.<\/span><\/span><\/p>\n

Certainly the case for having more than one income stream has been underlined in these last two years, and being able to work online from home has taken on a new advantage. <\/span><\/span>For many the idea of having an online business from home solves a lot of issues and generates money in the short term. At the same time it can be overwhelming to be wearing many hats in business without an established team around you. <\/span><\/span>It is important to take a step back and put all of these things in a bigger context in terms of your life aspirations and how money plays its part in that scenario.<\/span><\/span><\/p>\n

The Benefits of An Investment Portfolio?<\/span><\/span><\/strong><\/h2>\n

There are several good reasons to consider an investment portfolio. This is not the same as portfolio income. When approached properly it helps you become proficient in financial literacy which you can pass on to your children. <\/span><\/span><\/p>\n

Financial investments give you financial assets which can produce cash flow in the medium to long term income. Central to the theme of investments is that money is working for you rather than the other way round. It is a smart move to work in partnership with money, as opposed to simply working for it.<\/span><\/span><\/p>\n

The key is to have a diverse portfolio across several sectors to spread the risk and create good upside potential for profits. This is what Warren Buffet reportedly did so successfully. For many the word investment may sound a bit daunting, and too long term to be a serious consideration.<\/span><\/span><\/p>\n


\nImage Source: Investment Portfolio<\/a><\/span><\/span><\/p>\n

This gives clues as to where to start. Many people are caught up with the immediate short term things, only to regret not taking a more holistic long term view.  Here are three wise principles to apply to investing.<\/span><\/span><\/p>\n

The First Investment<\/span><\/span><\/strong><\/h3>\n

Steven Covey, author of ‘The 7 Principles of Highly Effective People’, advocates where life decisions are concerned, that you start with the end in mind and use that as a main reference point. This is all about the context in which all decisions play out.<\/span><\/span><\/p>\n

So you need to start with yourself, and decide what you want your life to be about moving forward and build accordingly.  ‘Know thyself’ is a phrase often read, but how well do you really know yourself?  Take the time to do this and you will reap dividends, pun intended!!<\/span><\/span><\/p>\n

The Second Investment<\/span><\/span><\/strong><\/h3>\n

Once you have done so take the time to invest in your financial education. Financial literacy<\/a> worldwide is very low, and yet significant money decisions are made everyday. This means there are likely to be far more speculators than investors involved in investing. <\/span><\/span><\/p>\n

Teach a Man to Fish<\/span><\/span><\/strong><\/h4>\n

There are many experts in investing with free videos on youtube to get you off the mark. Robert Kiyosaki is a well known expert who talks in terms of six basic rules<\/a>. He uses debt to invest and get rich while reducing or avoiding taxes with this strategy. He walks through the use of other people’s money, the three types of income, financial education, investing for cashflow, risk and raising capital.<\/span><\/span><\/p>\n

On the other hand the investment community I joined teaches the opposite in advocating not to use loans to invest. Only you can decide which path you will take, but know the ‘why’ and the consequence of each decision. Weigh up the pros and cons. This is why it is important to become educated, so you can make informed decisions.<\/span><\/span><\/p>\n

Give A Man A Fish | Teach A Man To Fish<\/span><\/span><\/strong><\/h4>\n

In the community I joined they allow you to partake in their portfolio. At the same time they encourage you to learn how to create your own portfolio, which I have since been doing. It’s a combination of two strategic approaches –  ‘teach a man to fish’ and ‘give a man a fish’.<\/span><\/span><\/p>\n

I learned about 8 Rules to govern my investment practice. I share them here in slightly paraphrased fashion so you can use these as guidance by way of developing your own portfolio.<\/span><\/span><\/p>\n