Best Investing Mindset Quotes From Unshakeable – Learn How to “Silence the Enemy Within”:
The single biggest threat to your financial well-being is your own brain…It’s just that the human brain is designed to make dumb decisions when it comes to investing. You can do everything right – invest in low-cost index funds, minimize fees and taxes, and diversify intelligently. But if you fail to master your own psychology, you may ultimately become the victim of a costly form of financial self-sabotage.
The trouble is, the human brain isn’t designed to make us happy and fulfilled. It’s designed to make us survive. This two-million-year-old organ is always looking for what’s wrong, for whatever can hurt us, so that we can either fight it or take flight from it.
Neuroscientists have found that the parts of the brain that process financial losses are the same parts that respond to mortal threats…So what happens? Red alert! The ancient survival mechanism inside your brain starts sending you messages that you’re in mortal danger…We have a tendency to freak out because our brains believe our financial downfall is certain death.
And what counts is not reality, but rather our beliefs about it. Our beliefs are what deliver direct commands to our nervous system. Beliefs are nothing but feelings of absolute certainty governing our behavior.
Some individuals are extremely successful in running a business or living their lives, so they just assume that they’ll be equally as effective as an investor. But investing…is more complex and challenging than it might initially seem to those high achievers.
Here’s the great paradox: by admitting to yourself that you have no special advantage, you give yourself an enormous advantage! How come? Because you’ll do so much better than all those overconfident investors who delude themselves into thinking they can outperform. When it comes to investing, self-deception may be the biggest expense of all.
We all have a tendency to want the biggest and best results as fast as possible, rather than focusing on small, incremental changes that compound over time. The best way to win the game of investing is to achieve sustainable long-term returns.
An undirected mind operates naturally in survival mode, constantly identifying and magnifying these potential threats to our well-being. The result: a life filled with stress and anxiety. Most people live this way, since it’s the path of least resistance. They make unconscious decisions, based on habit and conditioning, and are at the mercy of their own minds. They assume that it’s just an inevitable part of life to be frustrated, stressed, sad, and angry – in other words, to live in a suffering state.
It doesn’t even matter if the problem is real or not! Whatever we focus on, we feel – regardless of what actually happened. Notice too, that most, if not all, of our suffering is caused by focusing or obsessing about ourselves and what we might lose, have less of, or never have.
The trouble is, losing money causes investors so much pain that they tend to act irrationally just to avoid this possibility! For example, when the market is plunging, many people sell their battered investments and go to cash at exactly the wrong moment – instead of snapping up bargains at once-in-a-lifetime prices.
Commentary on the Top 10 Investing Mindset Quotes From Unshakeable:
Although active trading and long-term investing have major differences, the mindset factor remains high in importance for both. In active trading, our interactions within the market are happening pretty much every day that the market is open. Long-term investing, however, has the potential to be quite different. In fact, a completely passive approach to long-term investing could be commonplace thanks to automatic deposits and pre-determined asset allocations into our investment accounts. Some investors even manage their accounts by checking in no more than once or twice per year.
That being said, there are still individuals who deal with massive internal struggles when putting their money to work within the market, even with a long-term approach. They might intellectually understand the critical importance of compounding and that time is on their side, but still can’t stop themselves from checking in on their portfolio every single day. Feeling frustrated and depressed when their investments are down, or cheerful and fulfilled when their investments are up – their self-esteem riding on every small or large up or down movement in the market like a rollercoaster. Needless to say, this approach to long-term investing is completely unhealthy and downright exhausting.
Investing under this type of self-imposed agony is far from the best approach, but understandable in many ways. From the quotes above about how are brains are optimized for survival, we actually treat negative movements in our financial accounts as mortal threats. Literal threats to our lives, as if we just encountered a grizzly bear or great white shark. No wonder our natural reactions are panic and fear! And that panic and fear forces us to behave in impulsive and irrational ways. But the good news is that we don’t need to allow our subconscious conditioning to have this type of negative impact on us within the market if we don’t want it to. By cultivating self-awareness, we can notice how our brain operates and re-program it with more empowering and effective principles and beliefs. In the end, either you control your mind or your mind controls you.
Active trading and long-term investing don’t need to make you live in constant suffering states of anxiety, stress, worry, irritation, anger, fear, overwhelm, jealousy, sadness, and resentment. Discover How Mindfulness Can Help.
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Written by Matt Thomas (@MattThomasTP)
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I started looking at the stock market with my partner last year. I bought a book called Debunked and my partner bought this one from Tony Robbins… Both books were fantastic but I think this one was better from a mind set perspective.
I never got around to finishing reading Unshakeable but after reading about it here, I want to go back to it