INVESTING FUNDAMENTALS FOR OWNERS

It has always seemed to me that as soon as someone has something to invest they are thrown into the lion's den with little appreciation of what really matters.  Worth thinking about even for institutions and those already wealthy.

1.  Investing and Your Life

Start at the beginning. The key ideas and practices are simple, but most people seem to start off on the wrong foot and go from there. Successful saving is the foundation for successful investment.  Even if you are already very wealthy, there is something to be said for prudence, if only to guard against inflation.

 

2.  Making Saving Easier

Few people in the US save enough to reasonably assure financial comfort. Even the wealthy can overspend.  Here are some reasons why, and some approaches for breaking the spend-everything habit.

 

3.  When Savings Are Productive

There are many money illusions.  Looking beneath, we see that the basis for productive savings is real investment in increasingly productive businesses, achieved with reasonable ownership prices and low tax rates.

 

4.  What You Know Will Get You In Trouble

Your experience in the everyday world can be a perverse guide to the behavior of financial markets.  Until you shed your prior assumptions, you are likely headed for disappointment and may even be an inviting target for exploitation.

 

5.  Understanding Compound Returns

Most illustrations of the power of compound returns don't stress enough the importance of patience or explain how risk brings down typical results.

 

6.  How Much Risk to Bear

Other people will pay you to bear risk. This will be advantageous for you only if you know how to judge how much risk you can afford to take on at any one time.

 

7.  How To Reduce Uncompensated Risk

Make risk-bearing even more advantageous by diversifying some of it away.

 

8.  Making The Most After Taxes

The only sure things are death and taxes.  That doesn't mean you should neglect medical checkups or the basics of getting better after-tax returns.

 

9.  How Much To Spend

You've accumulated wealth and want to know how much it is safe to spend.  Don't be surprised to find that this is a hard question.  But here is an approach.

 

REVIEW THE IMPLICATIONS OF THESE SESSIONS: 10 THINGS YOU SHOULD KNOW