Why Investors Fail

6 Crucial mistakes cause investors to earn poor returns or even lose money

 

Most investors fail due to a lack of emotional self-control.

Investors who have failed often blame the market, however, it is most often their own fault for having made crucial mistakes. In my experience, investors who have failed have made one or more of the following five mistakes:

  1. Lack of emotional self-control and a true understanding of how the market operates.

  2. No real investment strategy.

  3. No real risk management strategy for down markets like recessions.

  4. Relying on brokers, banks or insurance agents to manage their wealth. These so-called “advisors” operate under the suitability standard and only care about their own pocket book with little concern to your well-being.

  5. Not hiring a real money manager, a Fee-Only Fiduciary, that legally works for you in your best interest.

  6. Not performing a simple background check on the firm you entrust your life savings to. Why trust a firm that has violated the law (often more than once!) at the expense of their clients’ retirements? (www.sec.gov or www.finra.org)

  *Too many investors don’t take the 5 minutes to check and I’ll never understand why   

These are not groundbreaking. Successful and experienced wealth managers have been bringing awareness to investors with respect to these crucial mistakes for years.

These mistakes are obvious and therefore they become familiar.  

When it comes to investing for your future, familiarity is dangerous. Why?

Either you don't notice your bad habits and miss the obvious signs or you have trusted somebody else with your retirement, but continue to take bad advice prolonging the issues that you’re experiencing. Accepting familiarity and failing to act will hurt your retirement or possibly cause you to lose it all.

 

Rezny Wealth Management, Fee-Only Fiduciary Money Management