Paul Merriman’s latest article at MarketWatch was titled The 12 Best Retirement Investing Lessons. A couple stood out as being especially useful.
Three: I have learned to focus on the things I can control and leave the rest to play out, as they certainly will, in an unknown future. What can I control? Expenses, taxes, turnover costs, diversification, asset class selection, to name a few. Most of the rest of what the media focuses on is only noise. I can also control (to some degree, at least) my emotions and my expectations and my discipline. I have learned that it’s extremely worthwhile for me to do so.
Seven…Instead, focus on the potential loss you could face if things don’t go as you expect. For example, any individual stock can lose most or all of its value, regardless of how good the “story” is regarding its products or management. A diversified stock fund, on the other hand, has an expected loss of only 50%.
Twelve: I have learned that 99.9% of successful investing is about defense, not offense. This means avoiding the loss of the money you have saved and the gains you have made.