COVID, Investing and Seneca

Fear is a bad advisor when it comes to investing. Both it and panic can make for a source of hasty and not very well informed decisions.

As the days go by, some of the same concerns remain over our minds. What is going to happen when the dust settles? What will we find once we are able to leave our homes once again and face “normal life”?

We have already taken a look at what opportunities can be found in this situation, including some priority assessment when we talked about the Quarantine Savings Challenge, and looked at the importance of dreams to make through all this.

Now, it is time we address the topic of resilience. Of what happens when things might fail. Because that is also a reason why people invest – as a way to diversify their income when not all goes according to plan.

Enter Seneca, a Roman Stoic that advised a kind of immunization process against your fears:

“Set aside a certain number of days, during which you shall be content with the scantiest and cheapest fare, with coarse and rough dress, saying to yourself the while: “Is this the condition that I feared?” It is precisely in times of immunity from care that the soul should toughen itself beforehand for occasions of greater stress, and it is while Fortune is kind that it should fortify itself against her violence. In days of peace the soldier performs maneuvers, throws up earthworks with no enemy in sight, and wearies himself by gratuitous toil, in order that he may be equal to unavoidable toil. If you would not have a man flinch when the crisis comes, train him before it comes.”

Let’s highlight a thought – “Is this the condition that I feared?”

With this in mind, let’s explore the conditions that fall before you at this moment.

1. What do you have?

These are your assets, your investments and accounts. Your sources of income and all that is material, from your home to the clothes on your back

But also the stuff that is less tangible. The relationships you have and maintain, your health. Anything that you are able to think of and enjoy.

If investing is on your mind, much of this exercise has probably been done in order to make your budget and start allocating a portion of your income working for you.

But as a rare walk outside (even if it is just going for food) can show right now, there are some assets one does not account for in a spreadsheet.

2. What do you want?

There is no shame in wanting. Wanting is what makes us get up in the morning and set out to accomplish our goals.

Do you want to travel more? Have a nicer house? See the world?

Such is human nature, and ambition is what helps us survive as a species.

And such as with your “haves”, your “wants” may go beyond the purely material. And good investing can get you to the point where you can even afford to just enjoy the time on your hands.

3. What do you need?

Think of this without judgement – what do you actually need?

And now think back to what your answer would be before this had all started.

Conditions change our perspectives, and it is important to keep that in mind.

And considering perspectives, there is that statistic going around: “If you have food in your fridge, clothes on your back, a roof over your head and a place to sleep you are richer than 75% of the world”

BONUS

Other than being able to build mental resilience to overcome the times we live in, there is also another, lighter side to all of this.

Once you realise that there probably is a difference between what you have and what you need, you may also realise that there is more that you are capable of investing to that you may get what you want.

Remember that you are able to withstand more than you think.And make sure that bonus is shared with those you care.