Tuesday, March 27, 2012

How to Get Rich - Avoid Fear and Greed

Are you afraid to make a change that will effect your future ?

Do you expect to become wealthy without working for it ?

If you answered YES to either of the above questions, chances are you will never become truly wealthy.

Conquer Your Fears

The first step to taking on any new venture is to conquer your fears. You will never be successful at anything if you are too afraid to take that first step. To conquer your fears you must first learn all that you possibly can about what you are planning to do. Learn from those who have done what you want to do. Follow in their footsteps and avoid the mistakes they made before they were successful.

Fear will keep you frozen in place just as the deer in the headlights on the highway. You all know what happens to that deer.

Control Your Greed

We all want to get rich now, not later. Look at all the programs that are trying to sell you on the fact that you can get rich fast. Sure it can happen, but not that likely for the average individual with moral values.

These programs play on the Greed Factor. They will take your money before you have a chance to start building your wealth. They can become an addiction when you keep trying this one and  that one. Don't fall prey to their high pressure marketing. Remember, they are the ones who are becoming wealthy on your greed.

Fear and Greed in the Stock Market

Fear and Greed are two major factors that drive the daily fluctuations of the stock markets around the world. Many investors are not properly trained and will sell when the market is declining because of their fear of losing money. These same investors will buy when prices are rising and near the top of their cycles because of their greed towards making money fast.

These untrained investors will more often that not lose their money simply because they cannot control their emotions of fear and greed. They buy at the wrong times and they sell at the wrong times. It is because of the herd mentality fueled by the media and stock analysts. Remember, the media makes money by selling stories and the analysts and brokers make money by buying and selling as many shares as they can.

What To Do

Control your emotions of fear and greed and do not let them make your investment decisions for you. Develop your own investment plan and stick to it. Know ahead of time when you are going to buy and when you are going to sell. Be realistic about how much you expect to make from an investment and do not be afraid to take small losses from time to time. We all make mistakes, it is part of the learning experience.

By avoiding the powerful emotions of fear and greed, you will truly be well positioned to take your place with the well educated and experiences successful investors of the world.

As always, I welcome your comments and suggestions for future topics.

No comments: