The price of admission for long-term investing: volatility and fear (The Psychology of Money #7)

About this episode

Many people know that long-term investing is the most effective way to invest. But the hard part has never been picking the right investment; it's whether you can make it through market volatility and fear.

In the seventh episode of The Psychology of Money series, I share three important ideas:

First, be reasonable rather than rational. Investing isn't about finding the perfect strategy, but a method you can stick with for the long run.

Second, you will change. It's hard to predict your future self accurately, so your financial plan needs to leave room for flexibility.

Third, there's no such thing as a free lunch. Long-term investing has its price too. Volatility, fear and uncertainty are the "price of admission" you pay for investing success.

Once you understand this, long-term investing becomes simpler than you imagined.

The episode is in Mandarin Chinese. These notes are translated from my original show notes.