HAVE A LONG-TERM VISION
The achievers are where they are today because they are different in their ways. Their achievements can be traced back to a lot of hard work, discipline, patience and a long term vision. The former will lose their essence if the latter is not strong and clear, in fact the vision is tailgated by the other attributes of the successful investor.
If you want to cook a dish for dinner tonight, you must know what’s the recipe, what is it that you are going to cook; you’ll not start putting in random vegetables and masalas and expect a delicacy on the table. Similarly all your efforts in life are put with the view to reach a destination, these efforts when extended over a very long period of time need a vision. A clear vision is something most of us lack when we invest. We invest in random instruments at random times, and expect a rewarding conclusion on the table.
Your investment habits, patterns, plans should all conform to and follow your short and long term goals at all times.
To be successful, to realize the fruits of your investments, you need a long term vision and clearly defined goals. “Chase your vision, not money, the money will end up following you.”.
HAVE AN INVESTMENT STRATEGY / APPROACH TO FOLLOW
A disciplined investment strategy elevates the investing experience of the smart investor. An investment strategy imparts clarity and discipline into the investing process. It acts as a guide when the investor considers different investment options for his investment portfolio.
However, you must understand that there is no universal investment strategy, and each should be customized according to your needs. It should fit within your long term plan and should work towards your short term goals. Your financial advisor will help you in devising a strategy which will guide you in taking sound investing decisions.
GET YOUR BASICS RIGHT
“Action without knowledge is dangerous”. Smart investors know what they are investing in and why are they are investing in it. This is one space where many of us fall behind. Sometimes we don’t even know what is the underlying asset class of the product we have invested in. Unawareness mostly results in unpleasant surprises at the end. Whereas familiarity with the investment’s characteristics help us take informed decisions as well as set realistic expectations.
Awareness enables you invest in products which can help you achieve your goals. For eg. You have inherited Rs 10 Lakh from the sale of a family property, now you are looking to invest this amount to fund your kids’ higher education expenses 10 years hence. As per your Dad’s advice you invest this money in PPF only to know that after 10 years, the value of your investment is nearly sufficient to fulfill your goal, but cannot be withdrawn since PPF has a lock-in of 15 years. To avoid such disappointment in future it’s best to educate yourself with the basics of the product.
SPEND TIME TO DEVELOP MULTIPLE SOURCES OF REVENUE
You don’t know what’s coming next, the best you can do is prepare yourself for the worst. Smart investors have a longer vision and they prepare themselves for any unforeseen exigencies by working on to get a second source of income. Having multiple sources of income is in fact one of the biggest reasons for success for many people. This can also mean diversification of your business so as to not be fully dependent on only one business in which case, you are exposed to risks like government policies, competition, market dynamics and most importantly, technology.
The second income will barge in to take care of your expenses and will give you the necessary stability to keep you going even when you are suffering from a down-turn in your primary source of income. During your highs, try to develop more sources of income, like a rental income, a part time business, a passive income from an investment, etc. and gift yourself some peace of mind.
KEEP LEARNING
There is nothing more valuable in this knowledge age than knowledge itself. Those who wish to be successful tomorrow are investing their time and energy to learn things today. Learning can be in any aspect – be it professional education or business learning or learning more about investments. The trick here is focus and depth of learning any particular thing which you believe is important for your success. Identification of what to learn is thus more important than learning anything.
Successful people spend a lot of time in learning, not just from books and experience, but also from the wisdom of the company they keep. Staying with friends those who are wise, experienced and learned is a sure way of life long learnings.
LIVING LIFE TO THE FULLEST
At the end of it, we come to a trait which is in fact the starting point of being successful, Attitude. Rarely would you come across any highly successful person who does not have a positive and purposeful attitude to everything that he does. Whether it is fun, networking, doing business or investing, there is clearly a no-nonsense approach and clarity as what is to be done. Often we find that even in family matters, these people have learned to strike a balance and keep relationships healthy. Taking good family breaks, enjoying life, etc. are visible displays of living life to the fullest. If you are doing it, better give it your best shot.
Being a smart Investor is simple but not easy. The above traits of a successful investor when adopted and practiced regularly, can put your financial life in right shape and can greatly enhance not just your investing experience but also your overall experience of life.
