Investing is a marathon, not a sprint - ask an endurance runner
Arecent US survey showing that endurance athletes earn three times more than the average person came as no surprise to me. As a financial planner and a passionate trail runner, I have come to realise that investors and successful endurance athletes have much in common, including incredible reserves of discipline and courage.
Investing requires consistency, perspective and patience. It's a marathon, not a sprint.
These are the six most important attributes successful investors and endurance sports athletes share:
1. They set defined goals
Successful investors and endurance sports athletes are not afraid of setting specific and meaningful goals - visualising and thus owning their future.
This involves a precise allocation of daily energy, resources and time and includes making difficult trade-off decisions. Should you allocate your hard-earned cash to important short-term goals such as a stress-relieving holiday, or should you focus on the long-term dream of retiring comfortably, for example?
2. They pace themselves and avoid instant gratification
Investing requires consistency and a long-term strategy that is balanced enough to prevent burnout. There will be moments when you feel that the long-term goal is unattainable, but ongoing planning, time in the market and kilometres on the trails will support success.
3. They rely on 'coaches'
Just as top athletes listen to coaches, winning investors rely on professional advice that is not only objective and based on years of experience, but also appreciative of the emotions that go into our hard-earned savings - and investor biases which can lock in a permanent loss.
Financial coaches help their clients to filter out the economic and political noise and apply investment strategies with the highest probability of success.
4. They embrace technology
Successful investors, like champion runners and cyclists, harness technology to their benefit and learn from online calculators and algorithm-driven applications.
What's more, they embrace the sophisticated financial planning software used by their advisers. They absorb and analyse the constant flow of information from digital platforms and have the confidence to rely on and discuss new concepts provided by their professional advisers.
5. They take a holistic view of life
In the same manner that successful endurance athletes balance training and rest, effective investors embrace a multidisciplinary approach that combines risk, liquidity, tax and estate planning. They appreciate the need to periodically realign their asset allocation to ensure it fits their financial goals and they value the efficient transfer of generational wealth.
6. They learn from their mistakes
There's no guarantee that you will win every race or ace every investment decision. In fact, life has a funny way of ensuring that some things don't go to plan.
Successful investors expect setbacks, are flexible in their decision-making and appreciate that how they respond to negativity plays a large role in their eventual success.
The finish line
As any marathon runner will tell you, with enough discipline and effort, human beings are capable of achieving anything we put our minds to. It all begins with breaking seemingly unattainable long-term goals up into manageable and achievable short-term objectives. To do this, you have to remain in the present by managing setbacks, fully commit to the process and trust that each seemingly insignificant step is one step closer to the end goal.
Provided you surround yourself with the right people and keep your eye on the prize by being goal-oriented, determined and consistent, you can finish the race we call life with flying colours. As they say in China, a journey of a thousand miles begins with a single step.
- MacSymon is the Financial Planning Institute's financial planner of the year for 2017