During my working years, I put aside funds I earmarked for investing. So during the day while I was busy working, my investments were also in action.
So, in a way, there were two activities in motion, in parallel. One was my daily life, another was the life of my invested funds.
The Way It Is
One way to look at it is that there is this parallel universe. Since my full time job was not in finance, my finances had a life of its own once I set it in motion by investing.
(And even if my work was in finance, it would not be 100% about my own finances. So the parallel life analogy still stands.)
The Point
My point here is that my financial life is not, and never was, an all time-consuming endeavor. For me, I set it in motion and go about my life otherwise. Occasionally I would add to my financial investments, but for the most part, these investments would live a life of their own.
The well known phrase “Time in the market beats timing the market” explains it all. “Time in the market” means long term. And 99.99% of the time, the compounding effects are ongoing without any additional input from me. I set the process in motion by initially investing, by adding to investments, by setting most accounts to reinvest dividends, and so on, but the growing and compounding occurs without additional stimulus from me.
Certainty
Certainly, there is input from me. I choose to invest in Company A instead of Company B. The reinvest dividends with Company C and not for Company D. I choose dollar cost averaging for Company E and not Company F. These decisions will have a large outside influence on my wealth down the road. However, it is impossible to know in advance which companies will thrive and which companies will stagnate.
The Way
So the process of living demands separation. Noone can be aware of all things at once. I cannot be aware of all things at once, I cannot monitor everything in my world at all times. I set some things in motion, and later can check back on them.
So it is with all things. We do what we can, and then later look back. Should I lament buying Company A stock instead of Company B stock? How much second guessing the past is beneficial? I my view, very little to none.
Which world do you live in? Let me know here.
Illustrated is the Fool’s Cap Map of the World (“O caput elleboro dignum”, “Monde dans une tête de fou”) from a map of the world by Abraham Ortelius in 1570, and superimposed on a court jester’s cap by Jean de Gourmont, ca. 1585-90. Courtesy Bibliothèque nationale de France.
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