If you talk to experienced investors today, you’ll find a few common threads in what they would do differently if they could go back and start over. Learning from their mistakes now can certainly help in making the most of your investment opportunities.
One of the biggest and most common regrets of experienced investors is that they didn’t begin investing earlier. How soon you start investing makes a massive difference. Even a small amount invested now can grow into the millions by the time you retire. Whereas if you put it off, you’ll have to work harder, and give up a far larger percentage of your earned income, and take more risks in order to try and catch up. The earlier you invest, the more time you give yourself to make mistakes and learn.
Hold, Hold, Hold
Another frequent regret is not having sold properties. Eventually real estate assets increase in value and have more income producing potential. At times, it is wise to exit to get the most cash out of a home, but that may pale in comparison to the potential gains of long term hold properties.
Buy Less Junk, Invest More
Whether it was putting off investing to buy junk that ‘promised’ instant gratification, or blowing all the gains from flipping houses on car leases and partying, most would go back and splurge less on items that just rust or accumulate dust, and reinvest it instead.
Invest in Learning
In investing it is what you don’t know that gets you. And you never know it all. Every moment spent learning can pay vast ongoing returns. No matter what the market and weather does, no one can ever take that from you.
Make Bolder Moves
There is probably nothing worse than getting old and realizing all those ‘safe’ plays you made, all the years spent watching TV in comfort, and times you didn’t go somewhere because it was too adventurous, was all a waste. Decades were wasted, often without any rewards for it, and with little real financial security gained. Make bold moves while you are young, and while you can enjoy it. Even if they don’t work out you’ll have plenty of time to catch up.
Think Longer Term
A five year plan simply isn’t long enough. To really be able to enjoy the fruits of your investing and to hold onto them you’ve got to think and plan a lot longer than that. The most successful think 100 years or more ahead.
No single thing, strategy or asset will perform amazingly all the time, forever. Not house flipping, not your favorite rental, not the stock market, not your business. The key is diversifying. Diversify into different assets, strategies, and locations.
There is a lot of benefit to be found in learning from the mistakes and regrets of others. Learn from these clues, so you don’t make the same mistakes, so you can enjoy the journey more, and be pleased with the end result.