A Final Word from Me… And Three Stages to be a Good Long-Term Investor
I’m not big on goodbyes.
So, I won’t say one. But what I will say is that this will be my last Money Morning essay for sometime.
If you’re a subscriber to any of my services through Port Philip Publishing, this won’t be a great shock to you. I released a video explaining what I was doing a week ago.
But if you’re not a subscriber and you only see my stuff through Money Morning, sorry to say but I decided to refocus my attention and time to the UK market.
My family and my home are in the UK now. Later this year I’ll have lived here for seven years. My son was born here, my dog was born here. My wife is from here, only the cat and I are Aussie by birth, an unbreakable bond between man and feline…
Straddling multiple time zones with a young family takes its toll. And in the interests of my family, I made the call to switch off my work with the Aussie office for the foreseeable future. Which means reallocating my time and intellectual resource to our affiliate company here in the UK, Southbank Research.
It will mean a better work/life balance for me. When I was younger and didn’t have kids, multiple time zones and crazy hours were fine and manageable. But life changes, and hence, so is my work with Port Phillip Publishing.
But as I say, I’m not going to say goodbye. That’s because I’ll still be writing Revolutionary Tech Investor for my Australian subscribers and working here in the UK for Southbank Research. And if you didn’t know, both Southbank and Port Phillip are part of a bigger global publishing business, Agora Inc.
So, we all still sit under the same roof — just in different countries and time zones.
Which means we still do occasionally share ideas, share great pieces of work, and share a thirst for the edge of the bell curve opportunities that the mainstream media never delivers to you.
But instead of hearing from me regularly on a Thursday and Friday as you have been, Ryan Clarkson-Ledward, who you should be familiar with by now anyway, will be filling my spots.
Ryan and I have worked closely together for over three years now, so I have no doubt there’s a lot that he’s going to deliver to you and open your eyes to over the coming years.
That said, for the rest of today I wanted to leave you with some advice that I think should be shared with the younger generations coming through.
I’ve always liked the idea of being a teacher, just not in the education system in the guise it exists today. And hopefully through Money Morning I’ve gone some way to helping educate you about some of the amazing opportunities that exist in the world today…and tomorrow.
But I also want to ensure that generations coming through have their eyes wide open as to what’s happening and how they can get involved in a way that helps to set them up financially in life.
Which is why I want to go through what I consider to be my three-step plan to being as good an investor as you can be, for life. It’s by no means a one-size-fits-all plan, but I think it’s pretty good. And it’s put me in good stead for my lifetime.
Hopefully you might take something away from it, or if not pass it onto someone younger who might…
The three-step plan
I was fortunate enough to learn early on — as a 10-year-old — the importance of investing.
And by the time I kicked into my teenage years I was familiar with stocks, investing, dividends, company research, and all the things needed to be a good long-term investor.
I plan to impart that knowledge onto my own kids, just as early, so they have the wherewithal to stand on their own two feet when it comes to investing when they’re ready to do it on their own.
But just because I learnt about investing, doesn’t mean I was some trust fund kid. I had a bit of a stash of shares. But I still had to work to run my car, to go out, to travel, to pay rent.
The value of the investments became a moot point. Sure, it would have been fine and dandy for me had I stepped into adulthood with a million-dollar portfolio behind me.
But reality is that’s just not the case for most people.
That doesn’t mean you can’t be a rich investor by the time you do step into the adult world. But the key is to be rich in knowledge. The money comes later — so long as you don’t leave it too late.
Hence to be a good long-term investor, I think it takes a fine balancing act that I categorise into three stages.
Stage 1) Get rich in investment knowledge as early as you can
That means if you have kids or grandkids, or a nephew or niece, take the time to sit with them, educate them about investing. Make it fun. Maybe build a little pretend portfolio to start with or slip a bit of cash into an account for them and do it for real. Give them the onus and responsibility for it. Do it together. Not only will you bond, but you’ll be setting them up with the life knowledge that you can’t put a price on.
Stage 2) Get rich in experience when the time is right
You could walk right out of high school and into Uni, then get a job with a top-tier company and start earning right away. What this does is give you a narrow channel, however. The best thing you can do while you’re young, free, and full of energy, is to take in as much of the world as you can.
You will never understand global markets from the comfy confines of a computer. Unless you’ve got some real world ‘boots on the ground’ experience in different cultures, different economies, and different countries, you will never really be a great investor.
Nothing truly explains how the world works until you seen it firsthand and comprehend the size, scale, and organisation needed to keep global economies ticking over.
Experience the world young, travel as much as you can while you can. It gets exponentially harder the older you get, until the lessons you should learn, are learnt too late.
Stage 3) When it’s time, earn, earn hard, invest smart, and never stop
While you should always try to save a little if you can, you also need to ensure it’s not done at the expense of stage one and two. You will get to a point where you will be able to earn and earn well.
My take is if you’ve done enough of stage one and two, then your potential in stage three could also be greater as well. So that when it’s time to earn, work, and really build your financial position, you can do so with full vigour/max power. The knowledge and experience needed to do it smart, do it well, and commit to it long term will have been gained, and you’ll now be able to put your earning potential to maximum effect.
This I think gives you the best platform to really set yourself up for life. It still gives you a crazy long-term runway which also means you can get your risk/reward balances right.
Some of this may appear obvious. But maybe it’s not? Either way, it’s a hard world to figure out what you should be doing and when you should be doing it. Maybe this helps a little, or a lot. But as I said, it’s worked out pretty well for me, and hopefully it will for you or someone you know that has their whole life in front of them.
It’s been a blast.
See you when I see you.
Editor, Money Morning
PS: Money Morning is a fantastic place to start on your investment journey. We talk about the big trends driving the most innovative stocks on the ASX. Learn all about it here.