Investors: There Is Some Work Involved

Investors: There Is Some Work Involved

by: Brendan Magee

Last night I was getting ready to do a presentation at a local library. The young woman at the desk who greeted me was very friendly and her interest was peaked when she found out I was an investor coach. She had a few questions about how she could become a better investor.

Now this woman is no investing novice. She has worked in a school district for over 20 years, has a nice pension, and has been participating in the school district's 403b plan since she started working there. However, she was bearing a few investment scars. There was the generous gift of stock her parents had bought for her. The stock,all in one company, had grown to $100,000 and then the company was brought out by a competitor and the value of her investment fell to $60,000. She was envious of the apparent success of day traders she knew and was feeling as if she was being left in their dust. She told me she drove by beautiful houses every day on her way to work and couldn't understand what those homeowners knew that she didn't.

She asked what advice I could give her. The first thing I recommended was a great book written by Charles Ellis,"Investment Policy, How To Win The Losers Game." She looked it up on the web and was more than a little displeased that it wasn't an audio book that would just walk her through the day trading experience. Even though the book was less than 200 pages long that was more work than she was willing to expend.

Next, I shared with her, that as a coach, I help people focus on the questions they need to be asking. I took her through a quick quiz and of the 20 questions she was able to answer yes to just a couple of the questions. I told her my job was to help a person get to the point where they could actually answer yes to all 20. I told her that in about three to four weeks most people could answer about seven of the questions and experience a pretty significant breakthrough. Her face sank even further.

Even though we had a little conversation about how day trading was actually gambling and speculation which wasn't a profitable endeavor, she still wanted someone to tell her how to do it. She wanted the magic pill. I could see the disappointment well up in her eyes as she was beginning to realize I wasn't offering a magic pill.

Hell, if one existed I would love to be able to have shared it with her, but that pill just does not exist. There is some work involved in becoming a successful investor. The work involves being able to answer and understand the answers to certain questions. Amongst them are:

-How do markets work? What produces the returns of the market?
-Have you defined your investment philosophy? How is that you want your money to be managed?
-What is your true purpose for money? What is it that you really want out of your money and life?

These are just a few of the questions that only the investor can answer for themselves. Someone (a coach) might be able to help you arrive at the answers, but the answers will only come between the investor's ears, no one else's.

An investor who cannot answer those questions and doesn't do the work that is necessary can easily be manipulated by advertisers, the media, and the investment industry trying to sell them one product after the other. For example, one could easily be manipulated into behavior, day trading even after they have agreed it is a harmful activity.

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