When considering your own financial position there are investments issues that you can and investment issues that you can’t control.
We are inundated with financial news, predictions, comments and analysis. For most people this can be overwhelming and unsettling with people using a lot of emotional energy worrying about issues beyond our control and to be frank, this is a waste of time.
As an investor I try to focus on the matters that I can control.
The investment issues that I can control
- Having a long term financial plan
- Educating myself on financial matters
- Establishing principles of when I do and when I don’t invest
- How I manage my cash flow
- The underlying asset allocation I have
- How I spend my time
- Benchmarking my investment performance annually
- Adjusting my strategic direction to ensure that I take advantage of the free financial free kicks available (eg salary sacrificing)
- Ignoring what I hear on television and focus my energies on reading the Financial Review and respected industry analysis of financial markets.
- Who I listen to and what actions I take on the basis of that advice.
Whilst I watch, read and I am interested in matters outside my control, I am also aware that there is nothing I can do to change these; I need to invest in the environment which is provided for me.
The investment issues beyond my control
- What the Reserve Bank does about interest rates
- How Australia performs globally
- Movements in the Australian dollar
- Market rallies, sell offs, and corporate actions
- Unemployment rates
- Corporate earnings
- How other investors react
- Government policy and its impact on my investments
- The media news and noise
- Australia’s gross domestic product
- The regulatory environment.
Many investors wastes considerable time and energy on matters they cant control
My advice is don’t let these issues worry you, play the hand you are dealt as you can’t change the rules.
Professional post by Charles Badenach Please contact him directly for more information