[How to Invest Happily: Spend Money When You Want, Eat Well, Sleep Well, and Worry-Free!]

【How to Invest Happily: Spend Money Freely, Eat Well, Sleep Well, Without Worries!】Casual Chat About Investment CLEC Investment and Financial Education Academy Blog Post Date: April 19, 2022

We suggest everyone invest everything, buy if you have money, hold long-term, and never sell. It sounds ideal, but the reality is harsh. Investing is simple, but not easy.

Everyone must always remember that the market still has short-term risks (usually when the market goes up, everyone forgets the risks, and when the market goes down, they don't know how to deal with the risks). When the short-term market declines, you still need money to live, and even if you have money to live, mentally you need to be able to eat well, sleep well, and be free of worries. So I often remind everyone: if the market drops 20%, will you panic? If the market drops 70%, will you still have money to live? If you can't bear it, or you may not have money to live, it means you have invested too much capital, meaning you are taking on risks far beyond what you can endure. When you realize you can't bear the risks, you need to adjust your investment positions and lower the level to reach a level where you can be at ease.

So when we say to put all your funds into the market, it refers to the funds you can afford to invest in the market (including what you can psychologically tolerate), not the money you need for living, or the money you would have no access to if the market drops, nor the money that you cannot bear psychologically to invest.

We used to often suggest that people who are still working should keep six months to a year's worth of emergency living funds. Retired investors should keep two to three years' worth of living funds. This is to avoid having to sell stocks for living expenses when the market goes down, and also so that you can still eat well, sleep well, and have no worries when the market declines.

Of course, many people, including myself, use stock pledges to get by. Although we still have money to spend, the correct way to invest and to be a happy investor is to be able to eat well, sleep well, and have no worries even when the market is declining. In other words, you need to consider that although you can borrow money to get by, if the market drops by 20%, 50%, or even 70%, you should still be able to remain at ease; that is acceptable.

Market declines are temporary, while market rises are eternal. However, investors must always remember, remember, that during market downturns, you cannot be without cash flow. You need to have money to spend so that you can get through the risks of a decline, see the light at the end of the tunnel, and witness the dawn. If you can maintain an emergency fund or if your debt is not too high, even during the dark period of a market decline, you can still eat well, sleep well, and have no worries. Always remember, our investment strategy is to be able to endure for twenty or thirty years, or even to never sell. As long as we are not forced to leave the market midway due to insufficient cash flow or unstable mindset, we can reach the shore of investment success. Therefore, never take on risks beyond what you can bear.

I want to remind some friends who take on too much investment risk that in the end, you might face a cash flow break, especially those who finance (we absolutely forbid friends who are investing from using financing), or investors who buy triple-leveraged products. You might not see the dawn of tomorrow, nor the light at the end of the tunnel.

I hope everyone can understand the nature of long-term investment profits, and recognize the reality of short-term market risks, so that everyone can safely get through short-term market volatility, hold onto your positions for a long time, and enjoy a wealthy and happy life together.