As humans, our brains are embedded with a natural instinct to survive. We constantly check our surroundings for danger and become hyper-vigilant when faced with uncertainty. We want to protect ourselves at all costs and react to perceived threats with a goal of self-preservation.
While our survival instinct is necessary to keep us from harm’s way, this drive to survive is not always helpful when it comes to investment decisions. We’re hardwired to panic and pull our money at the first sign of a downturn instead of riding it out and letting the market recover.
Rather than letting fear rule your investment strategy, it’s imperative to be realistic about your short-term and long-term financial goals.
In this episode, John explores our natural aversion to long-term investments and the importance of understanding which investment tools allow you to build real wealth.
In this episode, you’ll also hear:
- How natural instincts work against investments
- Understanding your long-term financial plan
- Winning at wealth like Warren Buffet
Must-listen moments:
[00:02:16] It's a natural drive to react first to protect yourself when faced with an unknown situation.
[00:04:08] It's probable that these very instincts that are designed to protect us may actually work against us when making investment decisions.
[00:06:33] This is why it's so important to understand your individual goals and to match your chosen investment tools to your unique financial job. If you do this appropriately, the fear of a market downturn affecting your lifestyle in the short term is greatly minimized.
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Disclosure: The preceding program is sponsored by Fourth Avenue Financial, which is solely responsible for its content. Securities offered through J.W. Cole Financial Member FINRA SIPC, Investment advice offered through J.W. Cole Advisors. Fourth Avenue Financial, J.W. Cole Financial, and J.W. Cole Advisors are unaffiliated entities. The opinions expressed by John K. Burdette II should not be construed as specific investment, legal, or tax advice. All economic and performance information is historical and not indicative of future results. Investing may involve the risk of loss of principal. Any Tax advice on this show is not intended to be used by any person for the purpose of avoiding US federal or state tax penalties that may be imposed on such a person, and each listener should seek advice from their tax advisor or legal counsel on topics that arise from the show. John K. Burdette II is not providing legal or tax advice. Nothing should be construed as solicitation of an offer to buy securities.