In­vest­ing is a marathon, not a sprint — ask an en­durance run­ner

Sunday Times - - Money - Marc MacSy­mon

Are­cent US sur­vey show­ing that en­durance ath­letes earn three times more than the av­er­age per­son came as no sur­prise to me. As a fi­nan­cial plan­ner and a pas­sion­ate trail run­ner, I have come to re­alise that in­vestors and suc­cess­ful en­durance ath­letes have much in com­mon, in­clud­ing in­cred­i­ble re­serves of dis­ci­pline and courage.

In­vest­ing re­quires con­sis­tency, per­spec­tive and pa­tience. It’s a marathon, not a sprint.

These are the six most im­por­tant at­tributes suc­cess­ful in­vestors and en­durance sports ath­letes share:

1. They set de­fined goals

Suc­cess­ful in­vestors and en­durance sports ath­letes are not afraid of set­ting spe­cific and mean­ing­ful goals — vi­su­al­is­ing and thus own­ing their fu­ture.

This in­volves a pre­cise al­lo­ca­tion of daily en­ergy, re­sources and time and in­cludes mak­ing dif­fi­cult trade-off de­ci­sions. Should you al­lo­cate your hard-earned cash to im­por­tant short-term goals such as a stress­re­liev­ing hol­i­day, or should you fo­cus on the long-term dream of re­tir­ing com­fort­ably, for ex­am­ple?

2. They pace them­selves and avoid in­stant grat­i­fi­ca­tion

In­vest­ing re­quires con­sis­tency and a longterm strat­egy that is bal­anced enough to pre­vent burnout. There will be mo­ments when you feel that the longterm goal is unattain­able, but on­go­ing plan­ning, time in the mar­ket and kilo­me­tres on the trails will sup­port suc­cess.

3. They rely on ‘coaches’

Just as top ath­letes lis­ten to coaches, win­ning in­vestors rely on pro­fes­sional ad­vice that is not only ob­jec­tive and based on years of ex­pe­ri­ence, but also ap­pre­cia­tive of the emo­tions that go into our hard-earned sav­ings — and in­vestor bi­ases which can lock in a per­ma­nent loss.

Fi­nan­cial coaches help their clients to fil­ter out the eco­nomic and po­lit­i­cal noise and ap­ply in­vest­ment strate­gies with the high­est prob­a­bil­ity of suc­cess.

4. They em­brace tech­nol­ogy

Suc­cess­ful in­vestors, like cham­pion run­ners and cy­clists, har­ness tech­nol­ogy to their ben­e­fit and learn from on­line cal­cu­la­tors and al­go­rithm-driven ap­pli­ca­tions.

What’s more, they em­brace the so­phis­ti­cated fi­nan­cial plan­ning soft­ware used by their ad­vis­ers. They ab­sorb and an­a­lyse the con­stant flow of in­for­ma­tion from dig­i­tal plat­forms and have the con­fi­dence to rely on and dis­cuss new con­cepts pro­vided by their pro­fes­sional ad­vis­ers.

5. They take a holis­tic view of life

In the same man­ner that suc­cess­ful en­durance ath­letes bal­ance train­ing and rest, ef­fec­tive in­vestors em­brace a mul­ti­dis­ci­plinary ap­proach that com­bines risk, liq­uid­ity, tax and es­tate plan­ning. They ap­pre­ci­ate the need to pe­ri­od­i­cally re­align their as­set al­lo­ca­tion to en­sure it fits their fi­nan­cial goals and they value the ef­fi­cient trans­fer of gen­er­a­tional wealth.

6. They learn from their mis­takes

There’s no guar­an­tee that you will win ev­ery race or ace ev­ery in­vest­ment de­ci­sion. In fact, life has a funny way of en­sur­ing that some things don’t go to plan.

Suc­cess­ful in­vestors ex­pect set­backs, are flex­i­ble in their de­ci­sion-mak­ing and ap­pre­ci­ate that how they re­spond to neg­a­tiv­ity plays a large role in their even­tual suc­cess.

The fin­ish line

As any marathon run­ner will tell you, with enough dis­ci­pline and ef­fort, hu­man be­ings are ca­pa­ble of achiev­ing any­thing we put our minds to. It all be­gins with break­ing seem­ingly unattain­able long-term goals up into man­age­able and achiev­able short-term ob­jec­tives. To do this, you have to re­main in the present by man­ag­ing set­backs, fully com­mit to the process and trust that each seem­ingly in­signif­i­cant step is one step closer to the end goal.

Pro­vided you sur­round your­self with the right peo­ple and keep your eye on the prize by be­ing goal-ori­ented, de­ter­mined and con­sis­tent, you can fin­ish the race we call life with fly­ing colours. As they say in China, a jour­ney of a thou­sand miles be­gins with a sin­gle step.

MacSy­mon is the Fi­nan­cial Plan­ning In­sti­tute’s fi­nan­cial plan­ner of the year for 2017

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.