How Investing Can Resemble Your First Crush
BY SHARI GRECO REICHES
I’d like to start by asking you to close your eyes and think back to…your first crush. Do you remember yours? Mine was Marc. He was cute, funny and geographically desirable since he lived only a block away from me. I remember talking to my friend Myndee about Marc and being really excited.
As I’ve thought about that period of time, I started thinking how investing mirrors your first crush. How so?
Well, the cycle of investing has five key phases that a first crush has too. Let’s take a closer look:
Ah, your first crush. He is cute and you start to visualize the two of you together. That’s when you go ahead and tell your best friend. She tries to find out if the boy has a crush on you (which Detective Myndee did on my behalf).
You budget well and now have some extra cash to invest. It’s been a good market, so you call your financial advisor (Shari, of course) to add to your portfolio. You are optimistic that this will be a great decision.
You’ve finally heard the news from your friend: Your crush likes you back! What a magical moment full of elation. Everything feels wonderful and you couldn’t be happier. Maybe after school you guys can hang out! Life is beautiful.
You have been watching the news and the market continues to go up. You meet with your financial advisor and it has been a great quarter. Your investment has increased. What a feeling! You’ve made the right decision.
Just when things seem like they couldn’t be better, all of the sudden you hear rumors from your best friend that your first crush might like someone else. Oh no! You get more than a little nervous. You question yourself in countless ways: “Did I do the right thing? Should I really have told Myndee that I had a crush on Marc? Will I be able to face Marc at school?”
A similar scenario can take place in this stage of investing. Things are going smoothly, with the markets heading up, up, up. Unfortunately, one day bad news surfaces and your portfolio takes a dip. Just like your first crush, nervousness takes over as you ask yourself, “Did I do the right thing? Should I have waited and kept the money in cash?”
Your Support System
When I was nervous about my first crush, I talked to my friend Myndee who calmed me down. Having Myndee there to help me work through the ups and down was very reassuring. She would say, “It’s his loss…”
It’s a lot like talking with your advisor during tough markets. Someone who can keep you more in balance and help you remember the “big picture” through the market’s natural ups and downs, giving great advice like “Stay the course.”
Relief And Stability
Good news! As it turns out, Marc didn’t really like the other girl after all. He likes you! What a relief. You might be able to breathe easy being on more solid ground. Maybe even for a whole week or two…
From an investing perspective, this is the feeling that you’re overcome by when the market recovers and you feel good about your original investment: “Why was I so emotional?”
Lessons to be learned from both your first crush and investing
- There are going to be ups and downs
- The experiences can be emotional
- Having a close friend or a financial advisor by your side is crucial
- Don’t get too comfortable about the relief and stability…the cycle will continue.
Does this bring back memories for you as well? You and I both know that first crushes rarely work out. However, unlike your first crush, investing and having a trusted financial advisor can result in a long-term relationship.