Jonathan Clements wrote a good article in his Getting Going column, titled Amid Losses, 12 Financial Truths Persist (sub. req.). The list is as follows:
1. It’s hard to cut back.
2. You’ll never be satisfied.
3. Borrowings have to be repaid.
4. Fancy cars and expensive clothes aren’t a sign of wealth.
5. Your family could prove to be your greatest liability.
6. Investors face three enemies.
7. Adding risky investments can lower risk.
8. Diversification is a mixed bag.
9. Not all risk is rewarded.
10. Most investors fail to beat the market.
11. Change is costly.
12. Your best investment strategy is saving.
Amen. Ain’t that the truth. Lest you think the points on his list are obvious, people almost never think of saving. Instead, they look for schemes that promise miraculous results. Even professionals look for shortcuts. Witness the fall from grace of Sharon Vaughn, once ranked on Bloomberg Wealth Manager’s annual list.
The moral of the story is to keep your eyes glued to your own money, ’cause everyone else is simply out for a slice of it. There is no reason to turn over your money if you can manage it yourself or do it with some decent advice.