The worst way to invest:
Hearsay “hot tip”
This is the most common mistake, where people “invest” based on the latest hot tip shared by their friends or in alpha/beta group chats. Or even YouTube. Unfortunately, it may not be the best and sound advice because by the time it gets to you, it’s no longer hot – this is problem #1.
Problem #2 is that if there is insufficient intel and conviction, it’d just be a distraction and fear.
Rushed / rush
This is the 2nd most common mistake by rookies, where they rush and FOMO into “hot tips” and projects…WRONG! Dont do this. This is what the scammers and cheaters want you to do, because they know
when you rush, you’d miss points and make mistakes
Sometimes it may be real, eg rushing for an ICO, but most of the time, dont rush. Take your time to research, read the white paper. Engage the team and community, and test out their product before you park even a dollar with them.
Safest way to invest:
Make it simple.
It must be something you understand simply.
Buy books, go for courses and seminars. Pay the money to learn from someone who’s doing / done what you want to achieve. For myself, I just paid to attend courses to
- dividend stocks
- China stocks
So that I know what I’m going into, what common pitfall to look out for.
One thing / investment a time.
One of the things that can happen is information overload.
Ie you can get overwhelmed. List down the items that you’re interested in, and then prioritize. Ask yourself,
what’s your plan / why are you there?
Yes, start with why.
It’d bring you much clarity and can help guide your decision making skills. For example, in the past, I used to be only looking for things that provide cashflow and passive income. Nowadays, I do still lookout for dividend stocks, online business, rental properties or assets that can provide me cashflow…
…but I also carve out a budget to invest in items that can have a lot more explosive and quicker growth. Not all my budget will go here, maybe 20% max, where it’s higher risks but much higher returns in a shorter time. The goal of this is for quicker “doubling of money” which will then be invested in “slow cashflow businesses”.
So, what’s your goal and game plan?
Don’t go all balls-deep in.
You dont have to use up all your savings or budget at a go. You can start with 10% first (or smaller), baby steps.
Get to know the process, the flow, how you think and how you feel about it. Maybe you’d be confident to do more; or maybe you want to diversify. Try on smaller scale first, then only go deeper.
The key to this, to me, is sustainability and consistency. I’d rather put in $1K/month for 10 years with dollar cost averaging (and waaaaaay less stress), than once off $100K.
I’m the founder and writer here at NigelChua.com; as well as serial entrepreneur, therapy business entrepreneur, digital entrepreneur, investor and also happy husband, father and Christian.
Started and sold off a business for 7-figures; built another 7-figure one and growing it further, plus building/investing into other businesses and investments as well as advisory works.
Nowadays I share and teach entrepreneurship, financial independence, retiring early as well as building and living a life you love.