Get Good Returns From Your Investments...

We sat down in that meeting, one Thursday recently, talking about investments. He was vehement as he counted his financial losses. He had been the speaker of a state assembly and eventually served as governor of an oil rich state.

This man that I was privileged to meet was winding down on the “work-hard” phase of life, he had entered into what I call the “chill-out” years(retirement years) with minimal results to show for it. He was waiting on the sale of a few properties to get some liquid funds. He had no cash to spare except for basic livelihood, for which he sometimes had to go cap in hand begging. This man boasted of tens of millions of dollars in his personal account at one time – but now he had very little to show for it.

As we talked, he was critical of my thoughts on investments. He wondered why I thought his investment decisions were not apt. I explained to His Excellency that the results of his investments decisions, his returns were the main determining factor of wisdom or otherwise of any financial decision.I explained that it was not up to me and that I had very little to do with it.

Your financial decisions have consequences. It isn’t a question of how you feel or what anybody says. It is a matter of the results you get over time. Your statement of financial position is your report card.

As we shared further, he emotionally described how he expected to make money in a certain business venture because he had seen a few friends make some money therein. He himself made some money until that stream dried up after a year. He had made heavy investments in millions of dollars in capital infrastructure. He had not been able to sell off the heavy duty equipments he spent a lot of money on.

I asked him if he didn’t talk to anyone before embarking on the venture and he answered that he certainly spoke to a few folks but not anybody that he could point to as a trusted professional advisor, or anyone who could evaluate the venture. He got into an investment of that magnitude with gutter advice. Bandwagon Investing!

Financial decisions should not be made on the grounds that everyone is doing something that looks good. You are not everyone. What is your financial plan? Have you identified your goals? Are they properly aligned to your values? Don’t go the route of the masses. Work out your own plan.

So His Excellency is finger biting now. He literally took every proposal that seemed good. No background checks, no diligent research… Nothing! He had no financial advisors, no plans and certainly zero financial education. By the way, traditional educational is not the same thing as financially savvy. His Excellency has several law degrees and many other titles but has done nothing about his financial education.

The best protection against financial loss is knowledge. You need to know about, saving, investments, assets, income, insurance, taxes, stocks, bonds, business and everything in between. You need to invest in your financial education. With all your getting, get financial understanding.