The emotions of investing
Investing is best done with a clear head, but that’s easier said than done. Welcome to the emotions of investing.
Investing is the most direct form of putting your money where your mouth is, so it’s not surprising that it comes with a whole host of emotions. Here are some of the emotions you’ll meet along the way and what to do when they arise.
Hope is a welcome companion on any investing journey. It doesn’t matter where you start, hope will see you on your way. And guess what? It’s contagious.
Typical symptoms include a positive outlook, inspiring others around you and an endless source of willpower. Hope is a powerful tool in investing so remember to keep some for when times get tough.
Fear: a shiver up your spine, a cold sweat and your heart hammering in your chest. When people told you that investing wasn’t always an easy ride, this is what they meant.
Fear isn’t without its uses though. Sometimes fear can be your body telling you it’s time to sell or rethink your strategy. These moments rarely come without a lesson to be learned. First, manage your fear and keep a clear head. Second, take action to minimise impact.
If investing wasn’t full of moments of joy, no one would do it. From making your first investment to watching your net worth grow, there are plenty of moments to get that dopamine flowing.
If you find yourself singing in the shower or surprised by the spring in your step, don’t be alarmed, these are classic signs of joy. Embrace these moments because you never know when the next one will come along.
A degree of scepticism goes a long way in investing. But sometimes this mentality develops into paranoia and can spoil moments when you should really just be focusing on life.
Investing should compliment the life you live, not ruin it. Obsessing over things you can’t control is a recipe for disaster, so take the time to think rationally before you make decisions that could have long lasting effects on your finances.
No matter how good you are at investing, one day you’re going to wake up and see a wall of red. Investing-induced depression can cause you to ask yourself why you bothered with this in the first place or push you towards selling everything the moment prices dip.
Remember that price cycles always correct themselves and that investing is a long term activity. You’ve got this!
Relief is best experienced when you realise that smart investing takes emotion out of the equation all together. If you’re fed up with the emotional rollercoaster of investing then we’ve got just what you need to start feeling that sweet relief in just a few minutes.
Our Savings Plans use cost averaging, the easiest way to invest and get rid of all the emotional baggage. Cost averaging is great because it’s simple and can help minimise the impact of price changes over time. All you do is work out how much you can invest and repeat it each month, no matter what the markets are doing or how you’re feeling. It’s that simple!
It’s important to pay attention to the emotions of investing because each of them can be triggered out of the blue and have an impact on your finances. We think that everyone should experience the highs and lows of investing as a beginner, but when you’ve had your fill, relief, relaxation and a stress free investing routine are only a few clicks away.