The word wealth signifies the abundance of financial resources. These resources can be safe and free from factors that destroy wealth. And it can also be exposed to certain factors that dissipate wealth. One of the ways to expose wealth to dissipation is to put wealth in the wrong investment vehicle. Especially when this investment vehicle operates in a turbulent and unstable investment market.
Investment vehicles are money growth vehicles that have two separate capacities. First, there have the capacity to grow and protect wealth. And then there also have the capacity to evaporate wealth. What determines what there do to wealth is affected by three factors. First, is where the money is invested. That is the investment vehicle. Second, is what guides investment decisions.
That is what goals an investor is trying to achieve. And the third is the investment market. That is how stable or unstable is the investment market. While investors can control their choice of investment. And the reason they invest. They can hardly control the unstable nature of the investment market. Investment markets will rise and fall regardless of what investors do. The goal, thus, is not to beat the market but to find ways to thrive despite the market.
So, what can investors do to thrive in a volatile market?
Investors can do three things. First, they must set clear, specific and measurable goals. Next, they must choose investment vehicles that align with their goals. And then next they must take actions that are congruent and in support of their goals. Below I expatiate on each of these three components.
First setting clear goals. Setting clear goals is the first thing investors must do to thrive in the investment world. When investors set goals, they are making it immediately clear, specific and measurable. What they hope to achieve with their investments. Without clear goals, investors can become emotional and risky with their investment decisions. They will go into the investment world blindfolded only to commit financial suicide. Investment goals are like a compass that guides investor’s decisions. And are thus critical for the safety and protection of wealth.
While many investors claim to have goals. A lot of goals are not specific, measurable or supportive of investment objectives. Setting clear goals means understanding what you are doing. And choosing the most appropriate investment vehicle to achieve your goals. It is also defining what investing success means to you. And choosing only investments that can deliver that success. Although many investors link investing success to financial returns.
Financial returns alone are limited in scope and value. True investing success is the ability of an investor to increase financial stability. To the point, where it becomes impossible for unstable market conditions to harm the investor. Wise investors pursue financial stability through the achievement of certain goals. And not volatile and depreciating cash returns. Thus, achieving financial stability is the only way to stay resilient. In the face of dwindling market conditions.
So how can investors achieve financial stability?
To achieve financial stability, investors must focus on achieving three types of goals. The first goal is personal safety goals. The second is growth goals. And the third are aspirational goals. Personal safety goals are goals that focus on protecting investors. And their loved ones from financial wreck. They help investors build solid financial foundations that help them sleep well at night. Personal safety goals ensure that investors stay grounded. And protected from threatening financial conditions. Despite disturbing headlines in the media. Its purpose is to help investors create a solid financial foundation. That can withstand turbulent market situations. Thus, when investors pursue financial stability rather than return. Their wealth becomes resilient and irreversible.
Next are the growth Goals. Growth goals are goals that help investors increase liquidity. There combine certain characteristics of growth and safety. Their purpose is to help investors enlarge wealth. Without compromising on safety. To achieve these investors, need a liquidity plan. A liquidity plan is a plan that expands wealth despite risky market conditions. Without liquidity investors, financial obligations are compromised. But while liquidity is important. Liquidity must be achieved within certain confines of safety.
Next are aspirational goals. Aspiration goals are goals that help investors fulfill certain emotional needs. They do not necessarily contribute to wealth and should be pursued with “fun money”. Fun money is any money investors can afford to lose. The purpose of aspirational goals is to help investors meet certain emotional needs. Without compromising financial safety. Thus, by meeting personal safety goals, growth goals, and aspiration goals. Investors can achieve financial stability and stay safe in the investment world. After clearly defining goals. The next thing investors need to do is choose the right investment vehicle that aligns with their goals.
Choosing the right investment vehicles means making it immediately clear which investment vehicle can deliver the goals an investor set to achieve. Every goal can be achieved with the right investment vehicle. Understanding what this investment vehicle is and the inherent risk in them is thus critical for investing success. When investors choose an investment vehicle based on goals. They are able to measure investment outcomes objectively. It is also the surest way to stay safe in the investment market. The fastest way to lose money is to put money in the wrong investment vehicle. After choosing the right investment vehicles. The next thing investors must do is act in the right way
Acting the right way means taking actions that lead to the achievement of certain goals. Action is critical for investing success. In fact, succeeding in the investment world has more to do with investor’s actions per time than the volatility of the market. The attitude and action of investors play a major role in wealth safety. While actions are critical. Not all actions are beneficial. Certain actions cancel investment efforts. The goal for investors is to understand what actions protect wealth. And separate it from those that destroy wealth. They must also decide to stick to actions that preserve wealth.
Actions that preserve wealth are actions that are congruent with set goals. Thus, by setting clear goals. Investing based on those goals and taking goal-based actions. Investors can create a solid wealth protection system. That keeps wealth safe despite changing market conditions. Investing is thus beneficial when it is goal-based.
When you want to invest in ways that preserve wealth. You must prove your resolve in actions and not words. Investing in a goal-based way may be straightforward but it is not easy. It is hard because it goes against natural human nature. While the natural human tendency is to follow the crowd. Bend to peer pressure. Invest to prove a point and engage in random acts of investing that pursue returns. Investing in a goal-based way seeks a disciplined and organised approach. Its sole aim is to help investors. Achieve irreversible financial stability that preserves wealth. This is the only way to remain safe. Enlarge existing wealth and thrive in an unstable investment market.
