I recently spent a weekend at an Investools Workshop, a two day program (eight hours a day) of learning about stocks, options, and investing. There was a lot of up-selling and sales pitch in there as well, but let me assure you, this was some solid training about how to invest. I was quite impressed and I learned a lot from this program. The most important thing I learned, though, wasn’t the trick of how to invest smart. Rather, it was the principle of money management.
Here’s what it comes down to: I don’t let someone else run my life. Similarly, I shouldn’t let someone else run my money.
Now, on the theological side, yes, God runs my life and my finances. Let’s accept that as being the case and leave it be. ((I believe wholeheartedly that God wants us to live our lives, and that he wants us to be good stewards of what he has given us. We don’t do that by sitting around doing nothing, or giving our talents to other people rather than cultivating them.))
The traditional method, as I was taught it, is to give your money to MetLife or some other mutual fund company. They invest it and make it grow, and they send you statements about how your money is doing. Until you start nearing retirement, you should probably just toss these in a drawer and forget about them because they don’t matter. You don’t lose or make any money until you sell your stocks, and you don’t sell until you retire, so forget’about’it. Let MetLife take care of your money and everything will be just fine.
As I have come to realize, though, MetLife et. al. sucks at managing money. I saw this myself before I first heard about Investools at the Get Motivated seminar. They just aren’t that good at managing money, and Investools clued me in about the “why.” The reason MetLife et. al. suck at managing money and subsequently lose tons of it as the stock market plummets (while others are still raking it in) is because they’re too big. There are a lot of restrictions on how much and how fast they can trade, so when things start too crash, they can’t react quick enough. When the market starts to go up, they can’t invest in time. In general, they’re sluggish and so they lose.
Five years ago, individuals didn’t have the tools needed to invest easily by themselves. Now they do, and the best toolset from what I have seen is pictured/linked above. It really gives you a lot of analyses you can’t get elsewhere, and without it I don’t think I could invest nearly as well. Right now I’m just working with fake money, but my confidence is growing as my analyses (with the help of the tools provided by Wealth Magazine) are proven correct.
If I rely on MetLife (and then pay them all the fees they’ll charge me over the years), we’re simply not going to have enough to retire. And it’s not just about retiring and Living The Good Life for our final years. I also have to take into consideration the declining health of the age’d. My goal since I was nine years old was to be a good husband and a good father, and part of that is making sure we’re not a burden to our kids. Being out of money but needing healthcare for another twenty years would suck for them, and I don’t want to do that to them. We’ll prepare early.
I don’t know how this will all work out, but I know this much: we need to at least be responsible enough to look after our own finances. We can’t just dump money in a mutual fund’s lap and assume they’ll take care of us. Therefore I’ll manage our finances myself, and Investools has given me what I need to do that.