Unconscious Driving, Unconciious Investing Will cost You!

Unconscious Investing Is Costing/ Will 

Cost You!!

by: Brendan Magee

We have all seen the life and death consequences of people texting while driving. This story, although a pain in my butt, isn't quite so tragic. It involves me backing out of my driveway and not noticing that my neighbor had parked his car right behind my driveway. Not a great way to start out the day by having to leaving a note on your neighbor's windshield letting him know you dented his car then dealing with your auto insurance and body shops.

All of this is a problem, but the real problem was me not paying attention or being aware of what I was doing and I will pay a heavy price in time, effort and money over the next couple of weeks.

There is also a price to pay, although you don't feel the pain until much later, when people invest in an unconscious way. How many investors are on cruise control or automatic pilot when it comes to investing? In a somewhat robotic way they do things the way their parents taught them how to do it. Invest as the guy in the next cubicle does it because it seems as if he knows what he is talking about or it's the quickest way to get the task of enrolling in their 401k plan off your to do list. How many are taking the advice of the pundits on cable television or the magazines assuming they are actually acting on sound investment advice?

Investors in a lot of cases fail to take notice of the process they are allowing to be used in how their money gets managed. They don't stop to determine whether or not it is being manged as it should or if they are simply allowing the brokerage house to get rich at their expense. Without the pain of having to reach into their wallets, it usually takes a momentous event like the crash of 2008 or the breaking news of a Bernie Madoff stealing $65 billion from investors for investors to stop and take notice of what is actually happening to them.

Unfortunately, or fortunately depending on how you look at it, those events don't take place all the time and investors, easily, fall back into the same old routine.

To determine if you are asleep at the wheel, it takes being asked a few questions to raise your level of consciousness.. How does the market work? Where are the returns of the market coming from? Can I measure to the penny what I am being charged to have my money managed? What are the expenses being deducted from my account? What services am I receiving in exchange for them? Can I tell the warning signs that I am engaged in or allowing someone to gamble and speculate with my money as opposed to prudently investing it? If you cannot answer these questions with a 100% yes, yes you are asleep and there are things going on with your money that if you knew about it, you wouldn't allow them to happen.

Now here's the problem you just don't wake up and stay vigilant. You need to engage in a conversation that allows you to maintain a prudent investment strategy. That requires staying engaged in a conversation for prudence. Without a structure it's just too easy to go back on automatic pilot. If your adviser doesn't offer an ongoing education process there's probably a good chance he is profiting off of your staying unaware about how your money is being manged and I would strongly suggest you consider hiring somebody else. 

Brendan Magee is the founder and president of Inevitable Wealth Coaching. With questions or comments go to brendan@coachgee.com or call 610-446-4322