Colin Kaepernick & Investing Where Opinions Don't Matter At All

Colin Kaepernick & Investing: 
Where Opinions Don't Matter At All 

     by: Brendan Magee

You couldn't go two minutes over the past couple of weeks without hearing about Colin Kaepernick and his protest in not standing as the National Anthem was played before the start of NFL games. Both, his supporters and detractors have had their say on the issue.

Thankfully, week one of the N.F.L. season has practically come and gone. Refreshingly, the focus was on the field and not on the sidelines and who was standing, kneeling, protesting, or doing what ever else they may choose to do. The focus was all on the players and which teams had the most points at the end of the game. What a refreshing change.

One of the better analogies on the pre-game shows was given by former Dallas Cowboys coach, Jim Johnson. He said, as coaches we get paid to win football games, period. My focus as a coach was in getting my players ready to play the game, because at the end of the day that is all that matters. He said he did not give too much attention to things happening outside of the teams confines.

Now, who wins the game is totally driven by who blocks, tackles, runs the ball, catches the ball, and who commits the fewest turnovers. Anyone watching the Eagles game yesterday could clearly see that that was the Eagles.

Investing is pretty much like a football game. Everyone has opinions about what should or shouldn't be happening, where the market's going or not going, etc. All those opinions might fill up the television air waves or fill out the pages of magazines, but they do not make one bit of difference when it comes to the success or failure an investor experiences. The results are, purely, behavior driven. An investor's behavior has to be consistent with following the rules on a day- in-day-out basis.

The question is, like blocking and tackling, what are the rules for successful investing? Not your rules, but the academically proven and empirically backed up rules for long-term successful investing?

The first to respond with the correct answer wins a great prize!

Brendan Magee is the founder and president of Inevitable Wealth Coaching. To respond to the question, make a comment, or ask a question e-mail brendan@coachgee.com or call 610-299-3969.

Mr./Mrs. Investor, How Would You Like That Cooked? Just Kidding

Mr./Mrs. Investor, How Would You Like That Cooked? Just Kidding

          by: Brendan Magee

Last week I was in Chicago with a lot of other business owners who were learning how to do a better job of marketing their businesses. As such, I ate my meals in a couple of restaurants. At lunch, I am with a fellow attendee and he orders a hamburger for lunch. The waitress kindly asked him how he would like the burger cooked. At dinner I ordered a steak and the waiter again asked how I wanted the steak cooked.

If you sit down with a financial planner or you invest on your own, you talk about or go over your goals, what you have experienced in the past and liked or didn't like. If you like what you hear from the adviser you perhaps give him or her some money to move your money into new investment products. If you don't like what you have heard you keep your money in your existing investments.

Never though is the investor asked how they would like their investments to be managed. They are never asked what approach they believe would be the best for them. Instead, the investment company takes the money and manages it as they see fit, never even bothering to ask the investor how they want their money to be manged, or even letting them know their is a choice available to them. So why would an investment company keep the investor completely in the dark about how their money is going to be managed?

 First one to respond wins a prize.

Brendan Magee is the founder and president of Inevitable Wealth Coaching. With a response to the question, e-mail brendan@coachgee.com. If you have a question or comment you can e-mail or call 610-446-4322

T.V.'s or Investing Trust Your Gut

Investors, Trust Your Gut!

by: Brendan Magee

You do not have to be an expert in something to know when something doesn't look or feel right. Under those circumstances, you need to stop and do not proceed any further until your concerns have been properly addressed.

I am not a master carpenter, but I can tell when screws are a lot looser than they should be. Case in point, I purchased a new flat screen television set for my conference room. The salesmen told me the store could send someone out to set up the television for an additional $100 where all they would be doing is securing eight screws into the base of the set. Having just spent a few hundred dollars, being able to read and follow the directions, and knowing righty tighty, I felt up to the task of setting up my new television set.

I followed the directions, had the stand screwed into the base of the set, and proceeded to put the set on the stand. Something wasn't right though. The set was a lot looser than what felt appropriate or safe. I had visions of my new set falling to the floor and shattering into pieces. I would be worrying all the time if I left the set as is.

I took the screws to the hardware store and within 10 minutes the guy told me the screws that came with the set were too short. I would have never known. He gave me a bag of shorter nails and in 20 minutes the set was secure, up on the stand and has been in good use since. As far as my set was concerned, I now had peace of mind.

My experience, I bet, was similar to what a lot of investors go through. They sit down with an adviser or do some research on the inter net and put together a portfolio that will help them achieve their life dreams. Only something doesn't feel right.

There are thoughts like, I don't understand how this investment works exactly. How much am I paying for this product? How will I know it's working or not working? How do I know that the funds and products I see on television aren't better than the ones I own? You just can't seem to get comfortable with these questions going unanswered.

This is the time to stop and get your questions answered. Do not stop until you have got the answers to your questions. All too often, rather than a television laying shattered on the ground, it's investors portfolios that are dashed in a million pieces and you can't put back together what you have spent a life time building. A couple of minutes acknowledging your doubts (not ignoring them) and taking the time to seek out someone who can get you the answers to your questions can be the difference between peace of mind and a disaster.

If you are dealing with a planner or adviser who is merely interested in selling you another product, your questions will not get answered. You will be told how your life will be that much better if you put your money in this product or that product.

If you are dealing with a coach, not only will they want to know what all questions are at that point, they will most likely add to the list. They will add a couple of questions you had not thought to ask. Getting the questions you hadn't thought to ask answered will be the key to eliminating any nagging doubts and having peace of mind.

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

Fear: Be It Zip Lining or Investing, It Destroys

 Fear: Whether Zip Lining or Investing,

It Drains Us Of Strength, Clouds Our Judgement

by: Brendan Magee

Fear is defined as a distressing emotion aroused by a real or imagined threat. Fear disrupts our lives, drains us of our spiritual strength, and clouds our judgement. At least that is what the pamphlet that I read just before embarking on a zip line adventure. 

To be truthful, as my guide, Emily, was helping me into my harness, I was thinking of some of the threats to my well being that comes when you are going to be anywhere between 25 to 65 feet in the air hanging by a wire. Forget about the fact that I was safely going to be hooked up to safety lines and the likelihood of falling was minimal. I was quite distressed. 

With a little time to ponder before hitting the zip line course, I thought about the role fear plays in the lives of investors.  There is plenty to be fearful of. What if the stock market crashes? What if my financial adviser turns out to be a crook and I lose all my money? What if I lose my job? What if I get sick? What if I don't save enough? How will I survive? 

Is there an investment decision we make that isn't some where rooted in fear?

We might not see it this way, but fear steals from us. It destroys our hope in the future and it robs us of the joy of living. 

If we walk around with a fear of the stock market crashing, by all costs we want to avoid that. We don't put a penny of our money in stocks. We play it safe and only go with guaranteed investments. Sure the three or four percent return won't keep pace with inflation and most likely I will out live my savings in retirement, but I don't have to live with the never ending fear of when will the stock market crash. Meantime, I have missed out on the annualized 11% the S&P 500 has done over the past thirty years as well as any chance of living a secure and comfortable retirement. 

If we walk around fearing being taken by a self serving financial adviser, there's no way in hell I am going to risk having my money stolen. I will just invest my money on my own. Who cares if I don't know how the stock market works or where returns really come from. If the market goes down, I will just get out until the market goes back up then I will reinvest in the market. I know I can't buy high/ sell low and be successful, but I just can't stand the thought of falling victim to an unscrupulous investment adviser.

Might not seem as if any of these scenarios could befall you. They are too simplistic, but every day, more people then you can shake a stick at are making decisions with their money which are totally based on fear. As we said earlier, fear clouds our judgement. We can't possibly know where the runway is if it is clouded over with fog. 

The only way for investors to begin to overcome their fears is by, first, admitting they have them. Until our fears are acknowledged poor decisions and behaviors will continue. Next, we have to admit that we can not overcome our fears on our own. We need a coach. Not only did I need my coach's knowledge in safely getting around the zip line course, I needed her encouragement and a gentle push every now and again. 

I don't think it is any different for investors. When we acknowledge our fears and surrender to the fact that we cannot control them on our own, we get back the strength, joy, passion, money, security and freedom that our fears stole from us.

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

I Didn't "Intend" To Market Time

I Didn't "Intend" To Market Time

                      by: Brendan Magee

I can't think of a word that has gotten more attention then the word "INTENT." F.B.I. Director James Comey brought a lot attention and shook the heads of a lot of people when he decided that charges should not be brought against Hillary Clinton because she didn't INTEND to harm the country with the use of her personal e-mail server during her tenure as Secretary of State.

Most of us have to live in a world where we do not get to split hairs. We have to live with what we did, not what we intended to do. Run a red light and telling the police you didn't intend to run the red light won't get you out of the ticket. Cheat on your wife and telling her you didn't intend to hurt her probably won't get you out of a big fat divorce settlement.

Investing is an area where intent can often overshadow the good or bad that results from our decisions. Market timing is defined as any attempt to alter or change the mix of a portfolio based on a prediction about the future. The definition seems pretty clear. Doing anything based on a prediction is market timing. The problem with market timing is that no one can consistently predict the future. Hence, if you engage in, or allow your adviser to engage in, market timing you are going to more often then not guess wrong and cost yourself money.

The Prudent Investor Rule circa 1990 spells this dilemma out pretty clearly, "Bargain shopping in an attempt to separate the winners from the losers based on a forecast about the future is deemed wasteful. 

What can cloud the issue and get us to engage in wasteful behavior? Instincts and emotions. I recently had a discussion with a colleague who was a proponent of  guaranteed annuities to protect against the drops in the stock market. Now this is not a dishonorable person. He genuinely has the best interests of his clients at heart.

We need to step back and look at what is driving his decision here. He doesn't want to see his client's money suffer a major loss such as 2008. Now all the losses he is fearing have happened in the past, 2008, 2002, etc. The crash he is trying to help  his clients avoid is some point in the future. He doesn't nor does anyone else know when it will occur or how severe it will be. Hence, he is investing money based upon a prediction or forecast about the future. He has unintentionally engaged in market timing.

Now what is wrong with that? There are rules for successful long-term investing that have to be followed at all times, Own stocks or equities, diversify, and buy low/sell high. These are no different then eat right and exercise as far as health is concerned. Following the rules isn't always easy or comforting, but we all know the penalties if we break them.

From January 1, 1996 through December 31st, 2015 there were 5, 040 trading days. If at the beginning of our time period you had invested $10,000 in U.S. Large Company Stocks and stayed invested all the way through, enjoying all the good days and enduring all the bad days, your investment would have grown to about $50,000. If you at some point decided to get out of the market and avoid what you felt are going to be some bad days for just say 20 days and those days were among the best 20 days (only 20 out of 5,040 days) your $50,000 account would only have grown to $20,000. (Investing involves risk and returns are not guaranteed)

The problem is no matter how noble the intention of helping someone avoid losses in the market is, no one  knows with any certainty when the good days will occur or when the bad days will occur. What we are also forgetting here is that avoiding the bad days doesn't even matter in the long run. All that mattered was  maintaining the discipline necessary to follow the rules for successful investing.

So know when you engage in or allow someone else to engage in market timing with your money you are not breaking the law and you will not face a federal investigation. History shows that you will most likely be costing yourself a whole lot of money and all the possibilities that go along with it.

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

Prayers Asked & A Lesson To Learn

Prayers Asked 

& 

A Lesson The Lesson Of A Lifetime

by: Brendan Magee

You or a loved one is doubled over and can't breath. Your arms and legs are going numb and you have a history of high cholesterol. What do you do? Take your loved one or get someone to drive you to the hospital and get checked out. You don't wait. It's not a hard situation to figure out.

It's a situation that a friend of mine was personally dealing with recently. As he was asked several times if he was alright and did he want to go to the hospital, he always responded that he was fine. He was so fine that he just recently suffered cardiac arrest and is not in the best of circumstances right now. I ask you to keep him and his family in your prayers.

We all know the right thing to do under just about any circumstance so long as it is happening to some body else.Your chest is tight and heavy. "I don't want to go to the doctors and be hooked up to all those tubes. I don't want to die! It will probably go away in a few minutes."

Theory is so much different than reality. We can be way too quick to believe that under any and all circumstances we will be able to act rationally. This is true whether it be dating, our health, or our investments, but the reality is that we, are not. All you have to do is look at the presidential election. Do you really think rational thought has led us to the candidates we are most likely going to be choosing from?

When it comes to investing we already know what to do in order to be successful. Own equities, diversify, buy low/sell high. We have all heard these rules, especially buy low sell/high. They are not difficult to understand, but following them day-in-day out is not as easy as it sounds.

The British decide to leave the European Union and the stock market goes a bit hay wire. All the experts are on t.v. telling us the world will never be the same again. Everyone is in a panic and asking, " What should I do now?" You already have the answer, own equities, diversify, buy low/sell high. Why is their any confusion?

The answer is instincts and emotions. It's painful to think for one second your life savings is in jeopardy. You get scared that tomorrow you will be living on the street. You have to do something. Who cares about those damn rules. "We got to get out of the market! Sell every thing and put it in cash or a guaranteed annuity. Any body else and you give a calm "You got to keep the long-term in mind. The market always comes back. Don't panic response."

The lesson of a life time is that investing success or failure is a direct result of what the investor does or doesn't do/ What they allow and don't allow to be done with their money. This more than anything will determine an investors fate. Their decisions come from their brains which is where knowledge, instincts and emotions reside. If we can get that when it comes to investing our instincts and emotions cannot be separated from our thoughts or behaviors.

They will be leading the way in our decisions, and history shows that, repeatedly, those decisions will be wasteful.To guard ourselves from our instincts and emotions, starts with acknowledging that we, on our own, cannot protect ourselves from our instincts and emotions. We need to put that job in the hands of someone we trust and never deceive ourselves into believing we can do that job by ourselves.

Our coaches job and ours along with it will be managing a never ending flow of thoughts and ideas that  occur in a flash and on a 24 hour-7days a week -365 days of the year basis. We can only interrupt this pattern if we stop for a second and ask someone if our decisions and behaviors are consistent with our ultimate objectives. Once you do, you will hear and hopefully respond to answers like "No get yourself to the doctor now, not in two weeks. No we are not selling just because Jim Cramer told you the market was in a free fall"

Strength and wisdom are the result of acknowledging our lack of strength and wisdom. Your pride may sting a bit when you swallow it at first, but you and your family love the long-term results.

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