Why Is Financial Strength More Important Than Outsmarting the Market?
When you start saving or choosing investments, it seems that making the “right” choice is the most important thing. In fact, persistence in your habits will do much more than choosing the smartest plan.
As the personal finance blog Listen Money Matters explains, it’s okay to screw up. You are going to make investments that will not bring the desired results. You are missing out on opportunities that you would like to take advantage of. This is fine. It happens to everyone. More importantly, you won’t stop saving. Persistence and perseverance in sticking to your savings plan will help you more than optimizing it from the start:
When the market drops or you blow your budget, do you give up and sell your investment, or do you keep doubling down? … [Research] Research shows that there is almost no correlation between success and intelligence. Are you smart or stubborn?
This does not mean that you cannot do your best to come up with the best plan. It also means that you cannot outsmart the market. The financial markets are too complex to be accurately predicted by even professional analysts, let alone Joe’s average. So don’t berate yourself for not choosing the best plan. Adjust, move on and keep moving forward.
The Importance of Financial Resilience | Listen to Money Matters via Rockstar Finance