Being an investor is both exciting and stressful. With the right strategy, you can maximize your returns on investment, leading to a more stable financial life and leading to the development of long-term wealth. But at the same time, a bad move could cause you substantial losses – and investing countless hours into your investing strategy can be daunting.
Fortunately, there are several ways you can make your life simpler as an investor.
One of your best options is to hire someone to assist you in your daily responsibilities. If you habitually invest in stocks, this could mean working with a brokerage to get additional advice or further insights about your planned trades. It could also mean hiring a consultant or a financial advisor to give you high-level direction on how to manage your finances or guard against the possibility of bad outcomes.
If you’re more of a property investor, you could hire a property management firm. Property managers work with you to make sure your properties are occupied with good tenants, that those tenants pay rent, and that your properties remain in good condition – all for a small percentage of your gross rent each month. It can turn all your rental properties into a truly passive income source.
Adopt a More Hands-Off Approach
Generally speaking, you could also adopt more of a hands-off approach. Investors often stress themselves unnecessarily by trying to time their purchase and sell orders perfectly; they want to buy in at the bottom and sell at the top, often making dozens of trades on the market every day. But the gains here often pale in comparison to those earned by purchases that are held for extended periods of time. Adopt a more committed, patient mentality and you’ll feel less stress while making more money.
Make Use of Automation
Consider employing the use of automation and other high-tech tools to minimize the need for manual intervention. For example, you can make use of a stop-loss order to make sure you sell a specific asset if it falls below a certain price; that way, you can lock in profits and prevent the possibility of losing everything in a major plummet, all without watching the asset too closely. You can also set up alerts, so you’re informed when certain events take place, or use automation tools to simplify or eliminate administrative tasks.
It’s tempting to become a master investor in each of several different areas; for example, you might want to become a master stock investor while also learning everything there is to know about property investing. While there’s nothing wrong with being ambitious and branching out to different areas, this can be overwhelming if you’re new to the investing world or have limited time. Instead, consider adopting one primary area of specialty; you can still learn things about other forms of investment, but they’ll be secondary priorities compared to this main focus.
Diversify Your Portfolio
Diversifying your portfolio is common advice for a reason. It’s one of the best ways to minimize the potential for devastating losses while increasing your potential gains over time. The idea is simple: invest in a wide range of different assets. That way, if a type of asset fails or suffers losses, you’ll have other opportunities to make up the difference.
Diversifying your portfolio and exposing yourself to a range of different investment opportunities may seem like it will only complicate your life, but once you have positions in many different areas, you’ll feel much more confident about your long-term prospects – and less worried about temporary drops.
Find Other Ways to Destress
Finally, understand that financial investments are inherently stressful. Even if you’re highly skilled as an investor, and winning on most of your financial moves, it’s going to take its toll on you over time. You may feel irritable, stressed, and susceptible to mood changes even when you’re on a hot streak of profitability.
Accordingly, you need to find other ways to destress in your personal time. Destressing is different for different people. Some love the idea of taking a long hike in the wilderness, away from other people. Others prefer to read a book quietly on their back porch. Still others want to go to loud concerts and release some energy on the dance floor. All that matters is that you find the right strategy for you, and employ it frequently enough to keep your stress in check.
Investing isn’t a simple strategy, and it’s going to have an impact on your life – but it’s almost always worth it. Be proactive in keeping the stress and complications in check; you’ll lead a much more balanced and stress-free life.