3 investment resolutions for 2024

Becoming a successful investor can make a big difference to your personal finances. The good news is that there is a simple path to success that almost anyone can follow.

You don’t have to be an investment expert to build wealth in the markets. All you have to do is make three investment resolutions for 2024 and stick to them. Here’s what it says:

1. Invest for the long term

Famous investor Warren Buffett has repeatedly talked about the benefits of choosing investments and sticking to them. He said Buffett said his favorite investment holding period is “forever,” and advised him not to buy an asset even for 10 minutes if he wasn’t comfortable owning it for 10 years.

Data backs up the billionaire investor’s advice. Studies have shown that buying and holding stocks outperforms 99.8% of strategies that involve switching between investing in markets and investing in government bonds. This makes sense. It can be difficult to predict when the right time to buy or sell stocks will be, and the costs of getting it wrong can be very high. Failure to invest money in the stock market during the five best-performing days from 1980 to 2022 could have reduced your returns by up to 38% over time.

Instead of trying to time the market and inadvertently losing huge amounts of potential profits, you should decide to buy assets that have a proven track record of success over time and leave those assets sitting in your brokerage account.

2. Don’t be motivated by FOMO (fear of failure).

It’s tempting to jump on the latest investment trend (I’m looking at you cryptocurrencies). Especially if you keep hearing stories of people getting rich quick by investing their money.

Unfortunately, you’re making a big mistake if you base your investment choices on what other people are doing.

First, you don’t know their motivations or long-term investment goals, so you don’t know if their strategy matches yours. Second, by the time you hear about this great new investment, it may already be too late to invest at a reasonable price. Because the price may have been raised by other people who don’t want to miss out either. You could end up buying high and losing big.

Investing based on what other people are doing won’t work for you as much as sticking to a tried-and-true approach. Instead of reacting to the actions of others, develop the confidence to stick to a sound investment strategy that works for you.

3. Keep investing simple

There is a simple way to make money by investing. For example, the S&P 500, a financial index that tracks the performance of the 500 largest U.S. companies, has averaged annual returns of about 10% over the past 100 years.

If you want to expand your business beyond simply buying index funds, you should have no problem picking your own stocks, as long as you research and plan carefully.

however many Complex investment products exist, from universal life insurance to artwork, precious medals and cryptocurrencies. Unfortunately, many of these products are difficult to understand, making it difficult to avoid losses.

Unless you’re an expert in the field you’re investing in, stick to the basics. Don’t risk loss by seeking additional returns through complex investments when you don’t have a clear idea of ​​how you will grow your wealth. It is too easy to get scammed or suffer big losses.

Ultimately, making these three resolutions will set you up for a successful investing year in 2024, with more to come. Put these principles to the test and put them into practice today.

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