Smart Reasons to Save, Use and Invest Money

Category Archives: Investments

Why Debt Reduction is Easier Than Investing

Becoming Debt Free

After first becoming totally debt free,  I felt a huge weight lifted from my shoulders and I thought the journey to wealth accumulation was a downhill journey… but I wasn’t even close to reality!

I figured I’d be able to redirect all the money I use to spend on debt reduction, into the stock market, and blammo, I’d be wealthy!  This hasn’t happened and in fact the opposite has happened in that I’m constantly worrying about the stock market.  It the first thing check in the morning, during the day, and it’s the last think I typically review before I go to sleep.  It’s all-consuming for me, and becoming quite the obsession, much to my chagrin.

What’s really funny, is I don’t have millions, but the way that I monitor the stock market, you’d think I was (curse you CNBC!).

Cat
I’m Okay

Why It’s Harder to Invest than Reduce Debt

For me, it’s simply the variability of my investment portfolio that makes it so stressful for me!

With debt reduction, it was always so clean!  You have an amount that you owe, and you make periodic payment to reduce that debt.  Pretty simple and straight forward huh…

With investing, it’s an entirely different animal that is very unpredictable.  Oh sure, you can invest on a schedule much like debt reduction, but that’s where the similarities end.  With debt reduction, there is no “real” emotion to the characteristics of the payment.  You pay the money, your debt decreases, no magic!

With investing you invest the money, and then who know what happens after that!  You can invest for years, then in a snap of your fingers, blammo you money is mysteriously gone!  Think Enron and Worldcom, blammo your investment is worth nothing except a tax write-off.

Another problem is that you can invest in a stock and it can flatline…  if a stock goes flat, you are just as good having your money in the bank, no?

Next there is the opposite of the above, boom, the stock appreciates hugely and you get rich.  This is the path that we all hope happens, but this is kind of like buying a lottery ticket to some degree.  It’s possible, but it take patience and determination.  Most stocks that appreciate hugely still takes years to get to that level.

So basically investing is like gambling and very emotional.

While investing is great and I love it, it’s very stressful for me.

I hope investing is less stressful for you.

Don

Was the Removal of the Uptick Rule Stupid?

The “Uptick Rule” was removed back in 2007 after a pilot study said that no manipulations occurred.This is what the pilot study found “The general consensus from these analyses and the roundtable was that the Commission should remove price test restrictions because they modestly reduce liquidity and do not appear necessary to prevent manipulation. In… Continue Reading

Financial Madness And My Financial Thoughts

This year is crazy, but crazy good not crazy bad, with way to may financial thoughts over-flooding my brain. Financial Madness: I admit, I’ve been caught up in the incredible stock market rally… until lately.  While I was beating the market earlier, I’ve bought some more risky stocks lately that have taken my return down… Continue Reading

Investing Is Like A Skill Based Game

The more I think about it, the more it’s obvious that investing is like a skill-based game! Like any skill-based game, the more you think about and practice with it, the better you become (hopefully). I’m finding that in many ways investing is very similar to a game such as Risk, or even Chess.  Investing… Continue Reading