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Opinion 31-12-2019 0

When to Overinvest

The world’s gone crazy.

For example, everyone laughed when America picked a right-wing, blond-mopped megalomaniac to lead their thriving economy, and there seemed to be a collective understanding that this was an error that should not be repeated. Unfortunately, it turns out this ‘collective understanding’ wasn’t that collective…

And then we’ve still got America squabbling with China, a national electricity supplier filled with clandestine operatives who can’t keep the economy’s life-support on, and Jacob Zuma dodging court with as much poise as ever.

So, it’s much of the same really, and yet there seems to be significantly greater negativity around. (Just me?)

Sure, the Rand’s continual slide is moving Europe a little further away, and general business confidence is flirting with all-time lows, but none of this is new to us hardy South Africans. We’ve dealt with far worse!

And yet the rumblings can’t be ignored; there is growing uncertainty. There are a lot more entries into the American Green Card lottery, as well as investigations in to whether that EU passport is worth the price of a property in Portugal.

So, when this is the world you are faced with, where do you invest your hard-earned, rapidly depreciating cash?

I’m no investment professional, but I predict that if you sit with one, you’ll generally get some of this:

“Over the long-run the All Share index outperforms the majority of fund managers anyway, so just put it there.”

 “You could move it offshore you know?”

 “Perhaps we increase that life cover just in case something were to happen to you? Don’t want your family to be left in a pickle.”

That’s not necessarily bad advice, I’m just pointing out that it’s conventional. We’ve all heard something along those lines.

But how often do you come across this question – why don’t you invest in yourself?

The great thing about this approach is you are in control. Poor company profits, bad asset allocation by fund managers or shock economic events don’t hit you as hard because you control far more of the outcomes.

Want a better job or to improve your skills? Take a course. There are plenty online.

Want a great experience? Go on holiday. You’ve got 192 countries to choose from.

Want to be financially independent? Start your own business. Putting your money in equities is really just betting on other companies to do well – why not bet on yours?

If people invested in themselves a bit more, we’d be in a far better place.

And if you don’t want to invest in yourself then go invest in someone else with talent and let them flourish – not all investments have to be measured by returns. Perhaps some should be measured by impact.

One thing to note though, if you do go down this path, is that there is only one way to successfully invest, and that is to overinvest.

All other strategies fail.

If this gets you thinking, and you’d like to explore some places where you can actually invest in yourself, even if it’s just your time for now, then here’s a great article which gives a quick overview of 25 different resources at your disposal. And some of them even free courses.


By Nicholas Bowman


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