How To Know If You’ll Be Successful

How To Know If You’ll Be Successful

By  Benjamin Hardy

Life is complex and messy. It can be extremely difficult to get traction, let alone find motivation.

But motivation is something you can learn to create at will. Becoming deeply passionate is also within your creative control. As a result, you can completely predict your own success. You can choose to become as successful as you desire.

Here’s how:

1. Turn Success Into A Game, Not A Grind

“Life is a game, play it.”— Mother Theresa

We hear a lot about people “grinding” these days. That sounds awful! Grinding day in and out is a path to burnout and misery.

The best performers in the world don’t grind, they game! For example, Warren Buffett became good at selling because as a child he would go door-to-door selling chewing gum. But he wasn’t focused on making money. Instead, he was fascinated trying to figure out which flavors sold best. Even back then, he was trying to make predictions. He’s still playing the same games.

According to author, Daniel Coyle,  “If it can be counted, you can turn it into a game.”

Rather than “practicing” in a tedious and boring way, you’re far better-off turning your practice into a game. This is why CrossFit is so successful. There are objectives — where you start and complete new challenges.

I recently had this experience learning Spanish on the app, Duolingo. I started seeing how many objectives I could complete in a single day, and how many days I could complete challenges in a row.

2. Know That You Can Succeed

“Ignition (n): The motivational process that occurs when your identity becomes linked to a long-term vision of your future. Triggers significant amounts of unconscious energy; usually marked by the realization: That is who I want to be.”— Daniel Coyle

There’s a moment when you see what you want and a voice organically speaks within you — “I could be that.” This experience is pivotal! How could you ever become an Olympic Athlete if you didn’t at some point see it and believe it in your mind?

Put simply, you need to have an identity shift. No “wannabe” ever made it big. At some point, they either gave up on their dream or stopped being a wannabe.

During my research as a graduate student, I studied the difference between wannabe entrepreneurs and successful entrepreneurs. None of the wannabes actually saw themselves as entrepreneurs. They hadn’t had the shift where they fully identified themselves as entrepreneurs. Conversely, successful entrepreneurs saw being an entrepreneur as who they were.

That identity shift happened as they began investing money into their entrepreneurial goals, and as they made the conscious decision — this is WHO I AM. Your identity follows your behavior. Therefore, this shift won’t happen until after you begin acting into the new role you plan to play. You don’t start with faith. You choose to have it. It’s a conscious choice, followed by behavior. Then identity and motivation follow.

3. Stop Hiding It

What other people think of you is none of your business.

If you want to remain mediocre at something forever, keep it to yourself. If you want to become extremely successful, then openly share your dreams with your loved ones.

To continue reading, please go to the original article here:

https://benjaminhardy.com/how-to-know-if-youll-be-successful-2/

Take Control of Your Money: What Does it Mean and How to Get Started

Take Control of Your Money: What Does it Mean and How to Get Started

By Cash For Tacos April 27, 2020

I like to say that my life changed when I took control of my money. And, more importantly, I want Cash for Tacos to help you take control of your own money and change your life as well.

But what the heck does it even mean to take control of your money? And if you don’t know, how can I inspire you to make changes? I think it’s a phrase worth taking the time to define. So let’s dive into what it means, why it’s important, and how to actually start doing it.

My Life Before I Took Control of My Money

Taking control of my money is what motivated me to start Cash for Tacos. The feeling I had once I took charge of my financial situation was nothing like I’ve ever felt before. I felt empowered and like I could accomplish things I had never dreamed of. But what did my life look and feel like before I took control of my own money?

My life looked like what I expected a “successful” life to be. I had a decent paying job, financed a nice car, went on nice vacations, and bought all the clothes and kitchen gadgets I wanted. I was making a life for myself as I thought I should be. But at the same time, I was constantly worried about whether I had enough money in my checking account to cover all of my bills.

Each month I had to get out the calculator and figure out if my paychecks would be deposited into my account in time to avoid the overdraft fees. It was a mess. I had no idea how much money I was spending each month. Money was simply flowing aimlessly in and out of my life. It was frustrating.

But then one day I finally got fed up with feeling like my money was controlling me. It was then that I started to learn about the ins and outs of my money. I focused on where exactly my money was going and how I could better utilize this valuable resource to design a life I was excited about.

With this new focus, I started putting my money to work for me; I directed where every dollar went. I purposely assigned my money to pay bills, fund a vacation, or be stashed away for retirement. And, don't worry, I didn't forget to assign some for random fun money. I no longer stressed about if I had enough money to pay my bills. And I actually started to work towards financial goals that would help me do things in my life like I never dreamed of.

Dreams such as transitioning from full-time to part-time work prior to full retirement and saving to pay cash for a campervan! I took control of my money and got it to start working for me. And boy, does it feel good.

Let’s take a look at what taking of control of your money really means and how you can do it with your money.

Taking Control of Your Money Means Knowing What You Are Spending Your Money On

How much of your money is going to your bills, your savings goals, and your wants?

When you don’t have control of your money, you simply hope that you have enough money to cover your expenses each month. And that’s not a fun place to be. Knowing exactly where your money goes each month is the starting point to take control of your finances.

 To continue reading, please go to the original article here:

https://www.cashfortacos.com/take-control-of-your-money-2/

Treasure Hunting

Treasure Hunting

By Richard Connor    June 5, 2020

Many of us have found ourselves with free time on our hands. I’ve read that folks are filling their days with shopping, baking, exercising and binge-watching TV. May I suggest another activity, one that may prove profitable?

Over the past few years, I’ve found significant amounts of money in unlikely places. These treasures often come not just with monetary benefits, but also great memories. Here are four places to look:

1. Forgotten savings bonds. I’m old enough to remember when paper savings bonds were a common gift for birthdays and holidays. Many companies also had savings bond buying programs, encouraging employees to invest and pitching it as an act of patriotism. If you signed up, the money to be invested was taken out of your paycheck.

Paper bonds were then mailed to you and you’d dutifully tuck them away for the future. I’ve been organizing my financial documents lately and I came across an envelope with a bunch of Series I savings bonds. I entered the required information in the Treasury Direct savings bond calculator and, much to my surprise, found they were worth nearly $10,000. I’ll bet many folks have old savings bonds hidden in the back of desk drawers.

2. Lost assets. Each state has unclaimed property that it holds, waiting for the owners to come forward. I haven’t checked every state, but I can attest to Pennsylvania’s efficiency. I recently found almost $1,000 in my father’s name. There were funds from an insurance company’s demutualization, an old savings account and the return of a security deposit from the Philadelphia Gas Co. Most of these were from the 1950s and 1960s. My father died in 1999, so the funds were divided between my two brothers and me.

A decade or so ago, we also found almost $17,000 in my wife’s aunt’s name. They were shares she received in 1984 from the breakup of the Bell telephone companies.

Searching for and claiming lost assets takes a little effort. You’ll want to try variations on your and your relatives’ names. I’ve seen claims with and without middle names. It helps if you know relatives’ old addresses. Be prepared to prove your right to inherit. We’ve had to supply death certificates and have our signatures notarized.

 To continue reading, please go to the original article here:

https://humbledollar.com/2020/06/treasure-hunting/

It Should Be Obvious By Now -- It Really Makes Sense To Have a Plan B

It Should Be Obvious By Now -- It Really Makes Sense To Have a Plan B

Notes From The Field By Simon Black   June 8, 2020  Bahia Beach, Puerto Rico

There are undoubtedly countless people right now who can hardly believe what they’ve been seeing over the past few months.

Global pandemic, total economic shutdown, tens of millions of jobs lost, trillions of dollars of debt and money printing, and now, social unrest, including riots and looting, brought on by yet another harrowing murder at the hands of the police.

A poll conducted by NBC News and the Wall Street Journal last week showed 80% of respondents believe the United States is spiralling out of control.

And it all happened so quickly.

We’ve been writing for years at Sovereign Man about the need to have a Plan B, consistently pointing out that this is a completely normal, rational thing to do.

A great Plan B is like an insurance policy. You hope you’ll never need to use it, but if you ever do, you’ll be really glad that you have one.

Having a Plan B is not capitulating. It’s not running away.

It’s sensible. It ensures that, no matter what happens or doesn’t happen next, you’ll be in a position of strength, regardless of what you choose to do.

If you want to march in the streets or dedicate yourself to social change, you’ll be better off with a Plan B. If you’re concerned about the policy impacts of mob rule, you’ll be better off with a Plan B.

Frankly what we’ve seen so far is potentially just a taste of what’s coming.

Just imagine how swiftly and viciously governments could react if another major outbreak of COVID-19 takes place.

Just imagine how much rage will explode in the streets depending on who wins the Presidential election in November.

And then there are other risks-- like the looming Cold War with China, spiralling deficits, etc., and we haven’t even begun to see the effects of those yet.

One key component of a Plan B is to consider-- is there at least a possibility that you might ever need to leave?

Would greater social unrest, economic upheaval, World War III, etc. prompt you to want to get out of Dodge? If so, you’ll want to have thought about that well before you start packing your bags.

So as part of a Plan B, it makes sense to have a second citizenship, or at least a second residency.

This means you’ll always have another option to live, work, invest, retire… and potentially even pass down those rights to future generations.

A Plan B also takes your finances into consideration.

Will the trillions and trillions of dollars that the Federal Reserve is pumping out cause serious damage to the dollar? Will Cold War with China compel the world to abandon the dollar as a reserve currency?

These are certainly possibilities. And that’s why gold and other real assets are also worth considering as part of a Plan B.

Retirement planning is another factor to consider; in the Land of the Free, Social Security is already set to run out of money in 2034. And as we discussed recently, post-COVID-19 estimates may accelerate the program’s cash depletion to 2029.

Therefore a tax advantaged retirement structure (like a solo-401(k) or SEP IRA) that allows you to save a LOT more money for your retirement and invest your retirement plan’s funds in a wide variety of assets-- private equity, startups, precious metals, real estate, etc.-- could be an option to explore.

There are so many other considerations-- tax planning, estate planning, family planning, asset protection… even things like homesteading or home schooling.

No two Plan Bs are the same. But the core ethos is that a Plan B makes sense, no matter what happens (or doesn’t happen) next.

There’s no downside, for example, in good tax planning that can save you money. There’s no downside in having a second passport that can provide generational benefits to your future descendants. There’s no downside in making it more difficult for people to file frivolous lawsuits against you.

Having a Plan B is like taking care of your health… it just makes sense. There’s no downside.

And, like health, it’s never too late to start.

To your freedom & prosperity, Simon Black, Founder, SovereignMan.com

https://www.sovereignman.com/trends/it-should-be-obvious-by-now-it-really-makes-sense-to-have-a-plan-b-27853/ 

Does Our Personality Help Determine Our Financial Success?

Does Our Personality Help Determine Our Financial Success?

Jonathan Clements    June 6, 2020

Does Our Personality help determine our financial success?  It seems it does, or so says academic research. Psychologists have zeroed in on five key personality traits: extraversion, conscientiousness, agreeableness, neuroticism and openness to experiences. Think of each trait as a spectrum from, say, very conscientious to not at all. Each of us sits somewhere on the five spectrums. Maybe we’re a bit of an extravert, somewhat inclined toward neuroticism, and extremely open to new experiences and ideas.

There’s a host of websites where you can take a relatively quick quiz and get scored on the five dimensions, including FiveThirtyEight, OpenPsychometrics and Truity. You don’t have to pay or give your email address to get the results at these three websites, though Truity has a more in-depth report that’s available for purchase. My scores from the three sites were remarkably similar, so taking just one test will likely suffice. What should you make of the five traits?

Conscientious individuals are organized and disciplined. They don’t leave their clothes on the floor or the dishes in the sink.

Openness measures our willingness to embrace new experiences and ideas. Those who score high in this area tend to be more curious and imaginative, while those with low scores are inclined to resist change and new ideas.

Agreeable individuals aren’t posting snarky comments on the internet or barking at you because you are—or aren’t—wearing a mask. Instead, they’re friendly, trusting, upbeat, concerned about others and slow to criticize.

Folks who score high on neuroticism aren’t necessarily “neurotic” in the colloquial sense. Rather, they struggle with emotions such as moodiness, sadness, anger and anxiety. At the other end of the spectrum are those who are emotionally stable and even-tempered.

Extraverts are the ones you hear talking at parties. They’re exactly what you would expect: They’re outgoing, sociable and enjoy being the center of attention.

No doubt all of us recognize some of these traits in ourselves and in those around us. But I’d pay particular attention to whichever trait seems to be most pronounced. Understanding who we are—and the mistakes we’re inclined to make—won’t necessarily prevent us from messing up, but it’s clearly a step in the right direction.

So what do our key personality trait or traits mean for our career and how we manage money? I pulled insights from a fistful of academic studies, including papers from 2008, 2011, 2012, 2015, 2016, 2017 and 2018. These studies don’t always 100% agree with each other, though their findings largely line up. Here’s what I learned:

 To continue reading, please go to the original article here:

https://humbledollar.com/2020/06/knowing-me/

38 Secrets for Financial Success: My Personal Finance Manifesto

38 Secrets for Financial Success: My Personal Finance Manifesto

By Len Penzo

Awhile back, somebody asked me to summarize my personal finance “playbook” in a blog post. Well … Here it is:

Debt is a form of indentured servitude where people agree to sacrifice a portion of their future earnings in exchange for instant gratification.

ATM machines are the Achilles’ heel of impulsive spenders.

History tells us that all fiat money eventually returns to its intrinsic value: zero. The US dollar is fiat money.

Given a choice, it’s always better to live your life anonymously rich, rather than deceptively poor.

If you have to ask your boss for a raise, then you need to find a new employer.

When in doubt, always choose credit over debit.

It’s almost impossible to effectively manage your personal finances if you don’t track your income and outgo.

Only suckers play the lottery.

People who properly manage their finances don’t fear credit cards. In fact, they embrace them.

Credit card “convenience” checks are anything but.

Frugality has its limits. The most effective way to stretch your income is by finding ways to earn more money.

Treat your household like a business; actively manage your finances and continuously look for ways to maximize your income.

Not everyone requires a budget to effectively manage their personal finances.

When it comes to saving money, patience is a virtue.

Nobody should pursue a non-technical college degree until they’ve calculated their projected payoff point and return on investment.

Precious metals such as gold and silver are for insuring wealth; not investing.

Money does not buy happiness. If you’re looking for nirvana, you need to focus on attaining financial freedom.

To continue reading, please go to the original article here:

https://lenpenzo.com/blog/id25399-38-secrets-for-success-my-personal-finance-manifesto-2.html

How to Invest a Million Dollars

How to Invest a Million Dollars

September 4, 2019 By Machinist

An avid reader of the Perpetual Money Machine blog wrote in last week to ask the following question.  Say you are 40 years old, you have one million dollars cash. How and where you should deploy your money to withdraw 4 percent (inflation adjusted) for next 50 years with a high probability of not running out. What type of asset allocation, funds you would go with? As I formulated my response, I realized that this question deserves an article of its own.  Here is my response.

Thanks for reading and for your question.  It sounds like you are in an enviable position, being millionaire at age 40.  I am going to make some assumptions about the missing details of your scenario.  Please let me know if I have assumed anything incorrectly.

Emotional Concerns About Timing

The first thing that strikes me about your situations is that investing a million dollars all at once could be an emotional challenge.  What if you invest tomorrow and the market trends downward for the next few years?  Would you panic and sell?  

Would it be easier emotionally if you had earned and invested that money over decades – if you knew that your cost basis was far less than a million dollars?

In point of fact, that’s all this is – an emotional concern.  It doesn’t actually change the strategy.  In fact, holding one million dollars in an investment is really no different than buying that investment each day.  If you invested a million dollars in stocks tomorrow, there would be little difference between your day-old account and my 20-year-old account.

If you are an emotional investor, then the rest of what I say here, might not be right for you.  Your best odds of successful investing are achieved when you buy the broad stock market and hold for decades.  I have described here and here how this strategy has delivered at least 8-10% returns over the last 80 years, through depressions, wars, presidents of questionable character, and everything else. 

These returns are more than enough to sustain 4% annual withdrawals, keep ahead of inflation, and grow your portfolio.  If you are committed to investing based on math and science rather than emotions, then please keep reading.

Advantages of Investing a Million Dollars At Once

Having one million dollars is a very nice advantage in and of itself.  Beyond than that, the only other benefit of having all that money at one time is that your options of account type and your planning for tax advantages are quite limited.  I’m calling it an advantage, because I’m trying to be positive.  Mostly it just makes your choices easier even if you don’t get to save on taxes.

How I Would Invest One Million Dollars Cash

To continue reading, please go to the original article here:

https://perpetualmoneymachine.org/how-to-invest-a-million-dollars/#more-618

Permanent Assumptions

Permanent Assumptions

Jun 4, 2020 by Morgan Housel

If you were told in January what April would look like, you wouldn’t have believed it. If you were told in April that in May we’d face a nationwide protest so important it would crowd out almost all Covid-19 news, you wouldn’t have believed it.

How do you analyze the world when everything feels broken? And how do you even begin to make sense of the future when things change so fast? Humbly, is the answer.  But humility doesn’t mean clueless.

Some things are always changing and can’t be known. There can also be a handful of things you have unshakable faith in – your permanent assumptions.

Realizing it’s not inconsistent to have no view about the future path of some things but unwavering views about the path of others is how you stay humble without giving up. And the good news when the world is a dark cloud of uncertainty is that those permanent assumptions tend to be what matter most over time.

Amazon is successful because it predicted how the world would change. But it’s been really successful because it bet heavily on what wouldn’t change – a permanent assumption. Jeff Bezos said:

You can build a business strategy around the things that are stable in time. It’s impossible to imagine a future 10 years from now where a customer comes up and says, “Jeff I love Amazon, I just wish the prices were a little higher.” Or, “I love Amazon, I just wish you’d deliver a little slower.” Impossible.

So we know the energy we put into these things today will still be paying off dividends 10 years from now. When you have something you know is true, you can afford to put a lot of energy into it.

When you have something you know is true, you can afford to put a lot of energy into it. That’s why permanent assumptions are important.

I have no idea what’s going to happen next in the economy or society. But I have a handful of permanent assumptions I’ve put a lot of energy and faith into that guide almost everything I think about business and investing.

Here are nine.

1. More people wake up every morning wanting to solve problems than wake up looking to cause harm. But people who cause harm get more attention than people who solve problems. So slow progress amid a drumbeat of bad news is the normal state of affairs.

 To continue reading, please go to the original article here:

https://www.collaborativefund.com/blog/permanent-assumptions/

15 Things To Stop Being Scared Of So You Can Be Rich, Happy, And Successful

15 Things To Stop Being Scared Of So You Can Be Rich, Happy, And Successful

May 11, 2020 By Michelle Schroeder-Gardner

Being scared is a natural reaction, but a lot of good things can and will be scary.

Often, people are scared when things are changing, like if you’re starting a new job, getting married, or any other major life event. It’s only natural to be a little scared about how things will turn out.

You might be scared when you are trying to do something that is difficult, like paying off debt. What if it takes you longer than you had hoped? What about the sacrifices you will have to make?

Being scared happens when you do or try things that are new or outside of your comfort zone, and everyone feels scared from time to time. You may not believe that you cannot achieve what you are setting out to do. But, you have to push through these negative moments and realize that you are holding yourself back if you want to start overcoming fear and let yourself move forward and do something new.

I have had a lot of fears to overcome to get where I am today. I was scared to quit my job to blog full-time. I was scared to move from our regular house to an RV. I was scared to move onto our sailboat. Being scared is natural, but if I didn’t address my fears in a positive way, I wouldn’t be living the life I am today.

Everyone is scared of something. However, it’s how you approach that fear that really matters. If you hide from your fear then you may be holding yourself back. This can then lead to regret later, which often feels worse than being scared. Whether you are wanting to tackle your debt, you want to leave a job you hate, you want to travel the world, and so on, you need to overcome the fears associated with these goals to live and enjoy the life you want.

Below are 15 things you should stop being scared of so that you can learn how to be rich, happy, and successful (or whatever you want to be!).

1. Don’t fear discomfort.

Many of the best things in life are probably going to make you feel uncomfortable. Being scared and staying in your box all the time, while it seems easy, can hold you back in some situations.

I’m a big believer that growth comes from trying things that make you feel uncomfortable! This may mean going on stage to do public speaking, climbing a mountain, selling your home to travel full-time, exercising, making new friends, learning a new skill, and so on. By doing things that make you uncomfortable, you may learn new things about yourself, find something that you love doing, and so on.

2. Stop being scared of what other people think.

If I let the opinions of others stop me from doing things, I would probably be hiding in a closet and never leave my house. This is completely different from how I used to be. Now I don’t care at all about what others think, and I couldn’t be happier. You shouldn’t let the opinions of others affect you. Like I always say “WHO CARES?!“


 To continue reading, please go to the original article here:

https://www.makingsenseofcents.com/2020/05/stop-being-scared.html

Five Lessons from History

Five Lessons from History

May 29, 2019 by Morgan Housel

“The dead outnumber the living fourteen to one, and we ignore the accumulated experience of such a huge majority of mankind at our peril.” – Niall Ferguson on the lessons of history.

“History never repeats itself. Man always does.”– Voltaire

The most important lessons from history are the takeaways that are so broad they can apply to other fields, other eras, and other people. That’s where lessons have leverage and are most likely to apply to your own life.

But those things take some digging to find, often sitting layers below the main story.

The Great Depression began with a stock market crash. October 24th, 1929. That’s the story, at least.

It makes for a good story because it’s a specific event on a specific day. But if you were to go back to October 1929, during the crash, the average American might seem unfazed. Only 2.5% of Americans owned stocks in 1929.

The huge majority of Americans watched in amazement as the market collapsed, and perhaps lost a sense of hope that they, too, might someday cash in on Wall Street. But that was all they lost: a dream. They did not lose any money because they had no money invested.

The real pain came nearly two years later, when the banks started to fail.

Just over 500 U.S. banks failed in 1929. Twenty-three hundred failed in 1931.

When banks fail, people lose their savings. When they lose their savings they stop spending. When they stop spending businesses fail. When businesses fail, banks fail. When banks fail people lose their savings. And so on endlessly.

The stock market crash wasn’t a relevant lesson to the vast majority of Americans who didn’t own stocks in 1929 and likely never would. But the bank failures upended the day-to-day lives of tens of millions of Americans. That’s the real story of how the Depression began.

As we look back at the Depression 90 years later, you might think the main lesson is “don’t let the banks fail.” And it’s a good lesson. But it’s also a lesson that’s not useful to many people today. I’m not a banker or a regulator. So what can I do with a lesson like “don’t let the banks fail?”  I don’t know.

And does it even apply to bank regulators in 2019, when things like FDIC insurance now lower the odds of repeating the kind of consumer bank runs we saw in the 1930s?  Only a little, I’d say.

The point is that the more specific a lesson of history is, the less relevant it becomes. That doesn’t mean it’s irrelevant. But the most important lessons from history are things that are so fundamental to the behaviors of so many people that they’re likely to apply to you and situations you’ll face in your own lifetime.

Let me offer one of those lessons from the Great Depression. I think it’s one of the most important lessons of history:

Lesson #1: People suffering from sudden, unexpected hardship are likely to adopt views they previously thought unthinkable.

One of the most fascinating parts of the Great Depressions isn’t just that the economy collapsed, but how quickly and dramatically people’s views changed when it did. Americans voted Herbert Hoover into office in 1928 with one of the biggest landslides in history (444 electoral college votes). They voted him out in 1932 with a landslide in the other direction (59 electoral college votes). Then the big changes began.  The gold standard, gone. Gold actually became illegal to own. Public works, surged.

To continue reading, please go to the original article here:

https://www.collaborativefund.com/blog/five-lessons-from-history/

You Have To Live It To Believe It

You Have To Live It To Believe It

Apr 9, 2019 by Morgan Housel

Richard Held and Alan Hein raised 20 kittens in pitch black darkness. Which is the kind of thing you should only do if it’s necessary to prove a point critical to understanding how the world works. Thankfully they did just that. The two MIT cognitive scientists, working in the 1960s, showed that seeing the world around you was not enough to understand how it works. You had to actually experience that world to learn how to operate in it.

The scientists raised cats in total darkness to control the relationship between seeing and learning. Once a pair of kittens were old enough to walk, they were placed in a lighted box for three hours a day.

In the box was a kind of carousel, with each kitten placed in a harness. One of the cat’s legs reached the floor, and its walking movements made the carousel move in a circle. The other cat’s legs were restrained by the harness. It could see everything going on – the movement, the other cat walking around in circles – but its legs never touched the floor. It had no active control over the carousel.

After eight weeks of daily carousel walks the cats were brought into the real light-filled world to test what they had learned. They were tested to see if they’d automatically place their paws on a surface they were about to be set down upon. And if they’d avoid a steep ledge, walking around to a gradual ramp instead. And whether they’d blink when an object was quickly brought close to their face. The results were extraordinary. 100% of the cats whose legs had control over the carousel’s movements tested normal. The cats who only watched, but never controlled, the carousel were functionally blind.

They bounded towards the steep ledge and fell straight off. They didn’t put their paws out to land on a surface. They didn’t blink when an object accelerated toward their face. It wasn’t that they couldn’t operate their bodies – they learned to do that in the dark room they were raised in. But they couldn’t associate visual objects with what their bodies were supposed to do.

The two cats grew up seeing the same thing. But one experienced the real world while the other merely saw it. The result was that one was normal; the other was effectively blind.

One of the most important topics in business and investing is whether all of us are, in some ways, like these blind cats.

Sure, we’ve read about the Great Depression. But most of us didn’t live through it. So can we actually learn lessons from it that make us better with our money?

Sure, we all know about the 2000 dot-com bust. But many – maybe most – investors and founders weren’t active back then. So do they actually understand the power of bubbles as well as those who did live through it?

My generation, the millennials, has never experienced significant inflation. We can read about gasoline lines of the 1970s and 15% mortgage rates in the 1980s. But am I as concerned about monetary policy as the Baby Boomer who does remember those things? And is the Baby Boomer as concerned as the Venezuelan who’s experienced hyperinflation? The answer to these questions is – at best – maybe.

I say it’s one of the most important topics because it affects everyone. What I’ve experienced as an investor is different from what you’ve experienced, even if we’re from the same generation. And the generation and country you’re born into, the values instilled in you by your parents, and the serendipitous paths we all wander down are out of our control.

Investor Michael Batnick says, “some lessons have to be experienced before they can be understood.” We are all victims, in different ways, to that truth.

This report digs into the effect difference experiences we’ve had have on our ability to make smart decisions about business and investing risk.

Part 1: Blind Spots

Two events shaped the 20th century: The Great Depression and World War II.

 To continue reading, please go to the original article here:

(A lengthy read but very intelligent - informative and interesting )

https://www.collaborativefund.com/blog/you-have-to-live-it-to-believe-it/