I was checking out an article the other day about Facebook. The article basically scolds the people who panic-sold Facebook when it was in the $20′s for being impatient and letting fear rule the day. This got me thinking about the whole process of investing and how it is connected to what we do in our everyday lives. I don’t just mean the products we buy but I meant the way we choose to act on a daily basis, both internally and externally.
Let me start at the beginning here. If you know me, and I think most of you do to some extent, you know that I have a tremendous amount of faith in the process. What I mean by this is the process that occurs during our lives when we embark upon a normal, everyday commitment. This can mean getting hired out of college to an entry level position, working your ass off for promotions and better paying jobs, hustling for connections, and then one day, ending up with a job that pays well and that you’re content with. Or maybe you’re out of shape and decide to go to the gym, eat healthy and put in the effort rid yourself of flub. Eventually, you’re in shape because you put in the work. I’m saying is that in life there is rarely a roadmap but there is a direction for us to move in so we can accomplish our goals, whether we know them or not. There will undoubtably be ups and there will most certainly be downs. Life is a process and it’s constantly evolving. We have to trust in the process, stay humble and patient, and one day our efforts are rewarded.
There are two aspects of the process that I see most people struggling with.. First and foremost, people have trouble recognizing that there is even a process to many aspects of life. They get trapped in the drudgery and bogged down by the nonsense without ever seeing which levers they need to pull to make their lives move forward. I’ve spoken about this before and I’d have to equate it to the concept of unconscious incompetence: if you don’t see a problem then obviously you won’t think one might exist. You may be unhappy but just not know why. Unfortunately, there are way too many people out there like this. You probably know someone like this. It’s someone who thinks the system is out to get them or keeps getting in their own way through self-destructive habits but wonders why they are behind all their friends. If you can’t recognize that there is a process to the many aspects of life, you won’t be able to effectively move forward in the process. It require reflection on yourself in a way that many people are unable or unwilling to do, because of the hard truths it may reveal.
The second problem I’ve seen is patience. We ALL have this problem at one time or another about one thing or another. This is the part of the process that the author of the article on Facebook mentioned above (see, I’m tying it all together!) and is a problem that many of us struggle with every day. Many of us get impatient in our careers and want to end up in high level roles much sooner than we’re ready. We get impatient and want to graduate college sooner. We want to buy a house before we’re ready, an expensive car, etc. We’re impatient and we know it. In the article mentioned above, the individuals who took part in the Facebook IPO and then lost money selling their shares suffered from a slightly different type of impatience. Fear of financial loss led to impatience which eventually caused them to sell their shares, incurring an actual loss. They lost faith in the process, grew impatient, and let fear drive their decisions. The moment you allow fear to guide you, you will make mistakes and it will cost you dearly.
No matter your career path, you can’t let fear be a driver of decisions. If your goal is financial Independence and you begin investing, understand that you will likely lose money at some point. Life is a process. It’s going to keep going, so trust it, be patient and don’t let fear make the decisions for you.