Dear FutureMoneyTrends.com Member,
For the most part, the financial publishing industry looks for new stock ideas. It’s what we spend the majority of our time doing here at FutureMoneyTrends.com. We search for great businesses selling at discounts – trades that have the potential to deliver above-average returns to our members…
I want FutureMoneyTrends.com to be a name you can not only trust, but a company that has a direct impact on improving your life. This is why I felt it necessary to write this essay today; because even though we advocate stock ownership, it’s important to note that it’s not for everyone.
What I want to share with you today is the truth… the truth that most people shouldn’t own stocks. I don’t know if you’re one of them, but if you are, this letter could be a major turning point in your life.
Wall Street has done a great job of convincing everyone that the only way to retirement is through stock investing. That in order to make an investment, you need to speak with a licensed financial planner or broker. But this just isn’t the case.
The truth is most people are just gambling when it comes to the stock market.
If you own stocks and have no idea what’s behind those businesses, their operations, cash flow and basic business model, then you should really consider selling them. Have a little respect for your own money. Don’t just blindly throw money at a mutual fund, ETF, or the stock pick of the week on CNBC.
Not having any interest in the businesses is why the real average stock market return is 2% — not the 12% claimed on the brochures at your local brokerage company. Gamblers buy high and sell low; it’s in our human DNA. When given the choice, we prefer to go with the crowd while finding safety in numbers, which wreaks havoc in our portfolios.
The best reason for people not to own stocks is that there are just too many other great alternatives. Real estate, businesses, corporate bonds, whole life insurance dividends and other investments that are far more stable.
Liquidity in the stock market is both our best friend and worst enemy. It’s amazing that I can buy shares of Apple with the click of a mouse, but it’s a curse that I can sell them the second my emotions take over my decision making.
One of the biggest mistakes every investor makes is the feeling that they need to reallocate capital the moment it hits their checking account. The best investment will always be in what is making you money right now. For most people, that’s their job or business. If you can’t invest more there, then save your money.
Only buy stocks if you are willing to take the time to learn about stock market investing; otherwise you are really just gambling.
It’s important for you to realize that you don’t have to own stocks. They aren’t your only option for building wealth.
Editor’s Note: Get extra income ideas and investment ideas that are completely outside of the banking sector in our premium membership letter. You can also find our Forever Stock portfolio. These are the best businesses in the world; ones that can help you create a dividend cash flow machine!