The process of making smart investment decisions is complex. While humility is a virtue in all parts of life, when it comes to making smart decisions with money, it serves as a vital layer of protection. When it comes to your money, there are no silly questions.
Remember that fellow student in university who raised his hand and asked the question that everyone knew the answer to? Remember how the class laughed and thought that person was dumb?
It turns out that person wasn’t dumb. That person was humble. Being humble, when it comes to money, is incredibly smart.
That Individual may very well have been Warren E. Buffett who, at the age of 86, still spends the majority of his day reading and learning. Why does he do this? To learn things he doesn’t already know.
You would think that Mr. Buffett — one of the most successful investors in the history of investing — would know everything he needs to know by now. But if there’s that much stuff that Warren Buffett still doesn’t know, chances are we could also stand to learn a thing or two. It starts with being humble enough to raise our hands when we don’t understand something. Smart investment decisions are not made by simply screening past performance of a list of investment funds and picking one. Smart investment decisions are made when you, the investor, are making an informed decision and it helps when you have a financial planner that understands your requirements.
So if we want to continue to make smart investment decisions, consider this a lesson we can’t afford not to learn. I’m not suggesting you should start reading hundreds of pages a day far from it. What level of analysis goes into your investment decisions? Does your chosen financial planner provide you with a sufficient level of expertise, or have access to investment specialists. Are you receiving an ongoing service appropriate to your needs?
If there’s something in your portfolio you don’t understand, say something now. Having the humility to admit there’s something you don’t know is the smartest thing you can do.
Ref: Carl Richards