Hey, 2017 is almost upon us. That means the inevitable urge to reflect and dwell on how 2016 has been has arrived as well. As Heartland Boy morphs into a pensive mode, along came the absolutely brilliant Heartland Girl. She who spends all her waking hours thinking of how to grow Heartland Boy had a brilliant suggestion. Heartland Girl decided that the readers have probably read and heard enough from Heartland Boy and are crying out for fresh perspectives. Never one to argue with Heartland Girl, Heartland Boy decided to round up a group of esteemed bloggers from the investment community to provide the best financial advice that they have learnt or received in 2016. Heartland Boy is certain that you will have lots of Eureka moments as well as fun learning from these brilliant individuals.
Achieving Financial Freedom
“Saving an extra $1 a day will not make you rich but the habit and discipline in doing so over a long period of time will.” by Giraffe Value
“As you draw bigger paychecks, you inevitably find your expenditure grow proportionately at the same time. There is really no reason why this should be the case, and if you could keep your expenditure in check, you are making bigger strides towards financial freedom.” by Heartland Boy
“Most investment bloggers talk about reaching financial independence or freedom; but few realise financial independence is more than just achieving a financial number. It is more about not becoming restless without those past daily scheduled routines and activities.” by CreateWealth8888
“Your (husband) money is my money. My money is my money.” by Heartland Girl
Understand The Business, Experts Not Always Right
“We are always taught to memorise things and not think about the actual concepts behind them. But in business and finance, it’s the most crucial; where you actually have to understand concepts and not formulae. (Credits to Martin Shkreli)” by SG ThumbTack Investor
“Invest in the business and not the stock. Hence, it is important to spend more time to study and understand the business before you part with your money.” by Invest Openly
“Don’t base your decisions on expert forecasts of what may happen. The ‘experts’ could not predict Brexit or Trump’s victory, and even if they could they were unable to predict the market reaction to it.” by Mr Propwise (the founder of www.propwise.sg, which aims to help people make better real estate buying, selling, renting and investing decisions)
“Expect the unexpected, and roll with the punches.” by Turtle Investor
Have Your War-Chest Ready
“Always keep a good part of your capital in a cash reserve. Never invest all your funds.” by Singapore Man Of Leisure
“Have cash ready and strike when there is an opportunity! (Credits to Boustead) In the short run, cash is like an option over every asset class, with no expiration date and no strike price. Cash provides the option to sweep up a bargain when it becomes available and this must have some value over the fact that it earns almost nothing. (Credits to Roger Montgomery)” by My Sweet Retirement
Investing During Bull Market
“No bull market has ever ended when the crowd is anxious; bull markets end on a note of euphoria and until the crowd turns euphoric, corrections should be viewed through a bullish lens.” by Taking Care Of My Own Business
“It is better to do capital drawdown to protect capital than to be dogmatic about dividend cash flow with capital loss. Be mindful about investing strategies during the bull market. (Credits to CreateWealth8888 and SMOL)” by SillyInvestor
Beating the Market
“Gross profitability is predictive of future returns. I picked up a study from Novy-Marx and he has shown that many earnings and free cash flow metrics do not perform as well as gross profitability, in terms of generating excess returns to the investor.” by BigFatPurse
“The difference between passive and active investing is that active investors are going in with the attitude that the market return is not good enough for them, and that they want and think that they can beat the market. So unless you think you have superior knowledge and know something that nobody else knows about, getting the market return through investing in ETF is good enough.” by Dollars And Sense
“Focus your attention, actions and mind to do one deep financial work. You will realise profound growth in your financial competency, something to add to your system and great wealth because you manage to buy something good or avert one big mistake.” by InvestmentMoats
Taking Extreme Ownership
“If things screw up, it’s our fault, even if the screw up is not done by me. This extreme ownership on problems upstream and downstream can be applied to your savings. If your boss does not give you a pay rise, it is your fault. If you have a thousand reasons not to cut your expenses, it is also your fault. This empowers me to change my surrounding so that I can solve my problems.” by Bully The Bear
Improving Quality of Life
“If you have a problem, throw money at it rather than stress out trying to solve it yourself. As I get older, I am starting to see the value in having more time, having peace-of-mind and having quality experiences. These things definitely trump an extra couple of bucks in the bank. Of course, this advice does not apply to anyone. If you are just scrapping by, it does not make sense to splurge unnecessarily. But if you have discretionary income, “wasting” money to improve your quality of life can be extremely transformative. (Credits to Time Ferriss)” by Cheerful Egg
Conclusion of Expert Round-Up
After reading this expert round up, the best advice Heartland Boy learnt in 2016 was still “Happy Wife, Happy Life.”
[…] the way, mr-stingy and Heartland Boy were kind enough to think that my *ahem* advice would help their readers, and I am more than happy […]