Smart Thinking On Investing – August 11
The Financial Panther kicks off Smart Thinking this week with a look at the earning potential of our side hustles. Writing for StockCharts.com, Gatis Roze compares drivers and investors. And Justin Castelli, guest posting on The Backcourt Report, explains the real value of a good financial advisor.
On his self-named blog, Peter Lazaroff invites us to use our imagination more when making financial decisions. And The Humble Dollar’s Jonathan Clements reveals the questions we should be asking to be on track for retirement…
Hustle Your Way to Retirement
- To many people, spending time on side hustles makes no sense, but for the open-minded person a side hustle can be turned into an extra couple of thousand dollars a year
- Every $1,000 you earn per year with your side hustle can be the equivalent of $25,000 of retirement savings
- And if you’re imaginative there are plenty of ways in which you can make extra money, from looking after other people’s pets to package delivery by bicycle
How much financial success do you gain from your side hustle? Share your experiences in the section below
Why Investors Are Like Drivers
- Just as 90% of American drivers believe their driving skills are above average, most investors feel the same way too about their trading abilities
- This is a dangerous notion to believe, far from mere confidence, this belief in our exceptional investing capabilities can lead us to make some serious errors in judgment
- Instead be humble, admit that you don’t know everything about the financial world and strive to keep learning and improving
The Source of a Financial Advisor’s Value
- With the increasing number of robo-advisors out there, it makes less and less sense to pay a financial advisor for portfolio management
- But a financial advisor’s value lies in the other work they do for you, such as coaching your investing behavior, holding you accountable, and helping you plan your financial future
- Most importantly, a financial advisor is there to support you with what you don’t know, which in finance is worth paying the fees for
Imagine Your Future Clearly
- Our brains struggle to compare our current state of happiness with that of our future selves and as such, fuel our tendencies to think about now rather than tomorrow
- Therefore, when it comes to making financial decisions, use your imagination to consider what your future self feels and wants, to clarify what is important to you
- Once you can clearly imagine the kind of lifestyle you want, it becomes much easier to work towards that financial goal
Are You on the Right Retirement Path?
- Are you managing to put away at least 12% of your pretax income? And are you maxing out your employer’s 401(k)/403(b) contributions too?
- Have you invested in the stock market early enough? And do you have a savings plan also?
- Is your financial future reflective of the lifestyle you want for your retirement? Do your goals match your retirement needs?
Do you want to start investing on your own, but don’t know how?
Anything you would like to discuss about Smart Thinking On Investing? Do you have any articles you would like me to cover? Feel free to add it below. Let’s start a discussion in the comments section!
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DISCLAIMER: This content is for information purposes only. It is not intended to be investment advice. Readers should not consider statements made by the author(s) as formal recommendations and should consult their financial advisor before making any investment decisions. While the information provided is believed to be accurate, it may include errors or inaccuracies. The author(s) cannot be held liable for any actions taken as a result of reading this article. Andrew Stotz doesn’t necessarily endorse any stocks or shares mentioned in the articles or the author of such articles linked to and summarized in Smart Thinking On Investing and cannot guarantee the accuracy of its information.