What is your investing ethos?
What are the guiding beliefs or principles behind your investments or your approach to money? What motivates you when you invest?
Do you have an investing ethos, or do you even put much thought into your investments or the impact or implications of your investment choices? Maybe it’s time to rethink why you invest.
When the average investor invests, their mind is purely on the money and striking it rich. Their motivation is to win big by buying low and selling high. It’s why the average investor speculates, ends up losing more often than not, and fails to beat the market.
As I’ve traveled the country and had the privilege of interacting with successful investors and successful people in general, one commonality has stuck out to me. All of these successful people don’t invest with money or profit as their overarching goal or guiding principle; it’s something more meaningful. They invest with a purpose.
The ethos of “investing with purpose” is about being deliberate and thoughtful in your investment choices. It’s about thinking beyond money as the end goal. It’s about what motivates you to accumulate that money, whether for the good of one’s own life or the good of others’ lives. It’s a call to move beyond traditional investing mindsets and to consider the broader impact of your investments.
HOW TO FIND YOUR INVESTING ETHOS AND ACHIEVE YOUR GOALS
Define Your Goals…
What is it that you wish to achieve through investing? Maybe you’re young, have no dependents, and have a high tolerance for risk. It’s your money, and I’m not one to judge, but if it’s your goal to continually chase the next big thing at the risk of losing everything, then that’s your prerogative.
Maybe you’re risk-averse. You don’t like to take risks or step outside the norm. You’re content with sticking to tradition. Your only goal is to make it to retirement in one piece—to have enough in retirement to get by.
Do you want something more than just speculating or getting by? Do you want to live your best life now and spend more time with your family, or do you want to spend more time and money contributing to meaningful causes? Do you want to leave something for future generations and charitable causes? Do you want to make a social impact?
STEPS TO ACHIEVING YOUR GOALS
If you have high and lofty goals, maybe the traditional route is not the way to go. You look around at your family, friends, and colleagues who all go the traditional route by investing through financial advisors or by contributing to 401(k)s and IRAs, and you realize that these paths are just not cutting it. These people are retiring in their 60’s when their best years are behind them, and you want to experience life sooner.
It’s time to explore other options beyond the traditional routes, and knowledge is power. Educate yourself. Explore alternative investment paths. Don’t ignore the traditional markets and investments. Delve into them. Understand them. Ask yourself why they fall short of helping investors with loftier purposes achieve their goals.
What are the implications of staying on your current path, and what are the possibilities of following a different one? Educating yourself on alternative investments may open up a world of possibilities for achieving your goals that you never thought possible.
Align Investments With Values…
Once you’ve determined your investing ethos and explored different investment vehicles, instruments, and markets, it’s time to choose investments that resonate with your personal values and ethical beliefs.
When faced with an investment opportunity, ask yourself if the investment is grounded in something tangible and real, or is it just a pie in the sky? Is there real-life demand for what you’re investing in, or is it just speculation and investors grasping at something that’s in the ether or a pie in the sky? If your goal is generational wealth and to take care of current generations and causes as well as future ones, maybe something real and tangible that will last beyond your lifetime may be preferable to something that can disappear tomorrow.
Monitor And Adapt…
Not all investments are going to be successful. There are certain segments that perform long-term, like commercial real estate, but even those segments experience short-term glitches. It’s important to regularly assess your portfolio and its performance, both in financial terms and in terms of whether it continues to align with your intended purpose.
For 2024, define your investing purpose. Then, once you find your investing ethos, educate yourself and seek out investments that align with your goals, beliefs, and ethics.