Trading vs Investing

Half the coun­try has no sav­ings.

I believe that what­ev­er hap­pens next is going to be worse than many imag­ine. People aren’t talk­ing about it that way because they both lack imag­i­na­tion and no one wan’t to yell the sky is falling. (But it is.)

Someone close to retire­ment once asked me (a very long time ago)… “I have $500, what should I do with it?” Even back then, $500 was­n’t a lot of mon­ey, and there isn’t any­thing you can do with it to turn it into a mean­ing­ful amount.

Like the Chinese proverb, the best time to invest that $500 was 20 years ago. The sec­ond best time is today.

The truth is, the best thing you can do is chip away at your wealth-build­ing goals lit­tle-by-lit­tle, then use the pow­er of time and com­pound­ing to your advan­tage.

And, that’s why that last line of the above tweet thread caught my atten­tion.

It’s not about tim­ing, or trad­ing — buy­ing-low and sell­ing-high — but rather about buy­ing and wait­ing. It’s about plan­ning for your far-in-the-future-you, so far in the future that most of us real­ly aren’t designed to think that far ahead.

There are so many things that work against human nature when it comes to invest­ing. We should­n’t also let a lack of edu­ca­tion about sav­ing and invest­ing com­pound the dif­fi­cul­ty. Building wealth, sav­ing for the future, is not about trad­ing and ‘play­ing the mar­ket’.

It’s about build­ing over time. About learn­ing.

There are so many excus­es (many good, some less-so) why it’s hard. Well, no shit. You know what’s also hard? Parenting. It grinds you down. It requires sac­ri­fice. It’s relent­less.

Is sav­ing for your future hard­er than par­ent­ing? No.

So then, what are you wait­ing for?