By Scott Ford, founder and CEO of Cornerstone Wealth Management Group
In my spare time, I enjoy spending time reading about investments and wealth management strategies. I recently came across an article that cited Wagner’s Rules for Investing, which include:
- Spend less than you make
- Save as much as you can
- Don’t do anything stupid
While I got a chuckle out of Wagner’s last rule, it got me thinking about my core principles for investing. If I had to simplify all of the knowledge and experience I’ve gained into a few simple ideas, what would they be? Today, I want to share my three rules for investing.
1. Balance
My mission is to help entrepreneurs and business owners find true wealth. What I mean by true wealth is the ultimate fulfillment brought about by satisfaction in each of the six pillars of life: Spirituality, Family, Health, Career, Philanthropy, and Finances. I know from experience that money without balance in the other areas can not bring happiness.
The first step to creating a powerful investment strategy is to identify your long-term goals and objectives to pursue true wealth. Once we work with our clients to identify their goals, we work backward to develop a plan and determine the rate of return needed to pursue their personal version of true wealth.
2. Leverage
Wealth management can be complex and involve cross-functional teams including CPAs, attorneys, insurance professionals, and wealth advisors. By leveraging a talented team that works together, your overall plan can become more efficient.
It’s important to work with a wealth advisor who is a fiduciary, which means they are legally required to act in your best interest. This person should be experienced in coordinating a team of professionals to bring leverage through collaboration. Be sure you understand what you’re paying each member of your team and how they are contributing to the overall plan.
3. Timing
One of my passions is practicing Brazilian Jiu-Jitsu. In Jiu-Jitsu, we consider the right move at the wrong moment to be the wrong move. Investing is no different, as your success is significantly impacted by timing. It’s critical to have an investment strategy that can navigate all seasons, not just perform well in bull markets.
At Cornerstone Wealth Management Group, we aim to minimize losses in bear markets and work with our clients to create strategies to navigate downturns. Consider if you had a fantastic career and saved enough to retire, but you happened to have planned your retirement party for late 2008. Your plan would be crippled due to market timing. It’s important to understand the impact of timing and create a plan to address the challenges presented.
Investing isn’t easy or simple, but sticking to a set of core guidelines can help us make better decisions and create strategies that can perform in a variety of market conditions. To learn more about how our investment strategies may help you pursue true wealth, please call our office at (301) 739-8505 or email me at [email protected].
No strategy assures success or protects against loss. Investing involves risk including loss of principal.
