Nerves Of Steel And The Psychology Of Investing

No matter where you invest your savings, putting your future in the hands of a stock, mutual fund or other investment vehicle can be nerve wracking. What happens if the the floor drops out of the market again? Are you really making the right move? Are there other options that have less risk with potentially more reward?  

There comes a point, though, where you simply have to roll the dice and have some confidence in your choice. There comes a point where you have to pull that trigger and let faith take over that you actually might know what you're doing and that things will turn out for the better in the long run.

The Psychological Aspect Of Investing

 

One of the most difficult parts of investing is purely psychological. Keeping an eye on your investments and dealing with temporary setbacks, dips in the market as well as gains can be difficult for some investors.  

For instance, let's say that you decide to invest in gold and silver, which is one of my favorite investments at the moment. The price drops two weeks after you purchase your precious metals. Having a little buyer's remorse is normal but understanding that investing should be looked at as a long term methods of leveraging your savings that will bring you more money over time instead of worrying about daily, weekly or even monthly fluctuation in the price of your investment.  

Just think of it as you would real estate investing. Even if you had bought a piece of real estate at the peak of the 2008 bubble, your investment would still be a sound one if you looked at it as a long term investment. Many investors dumped properties when the bottom fell out of the market and let their homes go into foreclosure.  

Without looking at the long term up side, you will dump almost every investment that you'll ever make before you give it the opportunity to mature and grow... and then you will be kicking yourself when that investment shows a profit five years from now. While many movies might give you the picture of investing as being that of a savvy stock broker who buys low, waits a few hours or days and then cashes out after making a killing, the truth is that most successful investors know that this is just Hollywood's attempt to glamorize investing.

Long Term Investing

 

Do your homework and look for investments that have been shown to have a good historical investment return while offering low risk for your savings that you absolutely must protect. Short of holding onto that cash and burying it in coffee cans in your back yard, precious metals prove to be a good solid investment that is still quite liquid.

If you're interested in learning more about investing in precious metals, you can talk to a precious metals investment adviser. Read this Regal Assets review to find out more about investing in gold and silver and learn why billionaires and governments are investing in gold these days.

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Real estate is also a good long term investment but it might lack the liquidity that you're looking for in terms of retirement income and if you're timing isn't right, you might wind up having to pass this investment on to your heirs instead of being able to cash out when you want when retirement comes.