We are what we repeatedly do. Excellence, then, is not an act but a habit.

10 principles of good investing


Good investing:

  1. Is taking the driver’s seat when it comes to your personal finances. Avoid money-wasters. Do not marry them. Avoid money-managers. It’s your money and nobody will care for it better than you.
  2. Is investing with money that you own. Avoid debt. Investing with borrowed money is called speculating and will likely end up in tears.
  3. Is saving a portion of your income. The most valuable thing you can buy with money is not cars or clothes or vacations or houses. It is your financial freedom. Hence, save at least 50% of your income.
  4. Is investing in the market. The market is the single best asset class over time. You do not believe me? Check this chart.
  5. Is realizing that safety is an illusion. There is no risk free investment. You can bury your cash in the back yard and dig it up 20 years from now and you will still have the same amount of money.  But inflation will have drastically reduced its spending power.
  6. Is understanding the market is volatile. The value of the market and your shares will sometimes drop dramatically. Do not panic. I repeat do not panic. The market will always recover. I repeat the market will always recover.
  7. Is investing in low-cost index funds. Vanguard is the best. Do not believe you can beat the index in the long run. Timing the market is a fable. Only Warren Buffett can.
  8. Is long-lasting. It avoids being fashionable and therefore never appears antiquated. The intention must be to keep your index funds for life.
  9. Is environment-friendly. Long-term investing makes an important contribution to the preservation of our planet. Because you safe more, you consume less. You are now an environmental hero.
  10. Is as little investing as possible. Less, but better — because it concentrates on and optimizes the essential aspects of your life. Back to purity, back to simplicity, back to Vanguard Index Funds.

* Jakcorb’s 10 principles of good investing are heavily influenced by Jim Collins “Simple Path to Wealth”. Please click on this link and read Jim’s blog. This will guarantee at least a day’s worth reading of solid investment advise!

** Jakcorb’s 10 principles of good investing are heavily influenced by Dieter Ram’s “10 Principles of Good Design”.

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Church lady: Hi young man, can I help you? You seem a bit lost.
Me: Uhhh… yeah…, I am a bit, I guess. You see, this is my first time in this particular branch of God’s house, and I must confess I am not exactly familiar with its customs and traditions.
Church lady: That is not a problem, we welcome all people, religious or not. Here in the Catholic Church we do things slightly different compared to… uhm… other ‘branches of God’s empire’. You mentioned customs and traditions. We do indeed have quite a few of those. In Catholicism traditions are just as important as the Holy scripture itself. We have a Pope; honour Saints; trade in religious artifacts; and drink Holy water. Also we have this concept of confessing your sins.
Me: Ow, cool that sounds like something that might be useful to me.
Church lady: Sure, I think the priest has time for some confessions today. You see that wooden booth over there, that’s a confessional. If you wait there, father will be there in a minute and he will explain what to do.

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