Marathons are considered to be one of the toughest sports out there. Why? Because it takes a great deal of energy and stamina to stay in the race and not give up. Also, it is not always about winning for a marathoner. Rather they are always striving to better their previous records.
After reading the title, you must be wondering what the hell this is about, right? Like how can one connect marathoners and investing in Mutual Funds, Fixed Deposits, etc.?! Well, trust us when we say that there is a deep connection between the two. You can actually learn the best investing lessons from these guys.
Additional Reading: Balance Your Investments Like A Pro Gymnast
Here are a few investing lessons we can learn from marathoners. Ready, steady, go!
Marathon Rule 1: It’s not just about the long run, you gotta survive in the short term.
Why do we invest? Most of us do it so that we can accumulate enough funds to realise our financial goals. And if you want to achieve your financial goals, your investment portfolio must have the right ingredients to help you gather enough funds to fulfil your goals.
But at the same time, you will be faced with other immediate needs which you cannot ignore. And you will require funds for the same. That’s where a contingency fund comes into the picture. It should be large enough to cover all your immediate needs and any unforeseen emergencies.
Just like in a marathon race where it is important for the marathoner to survive the short term and sustain him or herself till the end, you need to take care of your short-term requirements and still save enough to meet your long-term goals. You get the point here, right?
Marathon Rule 2: No excess baggage, please. You gotta run light.
It is going to be a long run! You know it is. So, it’s wiser to scrap additional load and run light if you want to be in the race till the end. Now, think of this in terms of investments. What could the excess weight on your portfolio be that will hamper your personal finances? Of course, the various liabilities – medical, financial, social – that could disrupt the consistency of your portfolio.
For example, over-spending on your Credit Card and having to pay a huge bill every month is a liability that can hurt your investments. Such liabilities will force you to maintain liquidity in your investments, thereby not allowing your investments to grow to their full potential. If you want your investments to grow with time, drop the extra weight.
Marathon Rule 3: Don’t let the distance intimidate you; break the race into smaller segments.
Marathons can be over 40 kilometres. And most of us are often intimidated by the long distance that we have cover to finish the race. But if we break down the distance into smaller distances, like kilometre by kilometre, it becomes much easier to cover the distance and finish the race.
Apply the above technique to your investments. For instance, some of your financial goals such as your child’s education can be quite intimidating especially with the high cost of education these days. But if you save a fixed amount every month and invest the same in a financial instrument like Mutual Funds regularly, you can easily build the necessary funds to achieve your goals. It’s not that hard. Trust us.
Marathon Rule 4: It isn’t always going to be a rough run.
A marathoner’s path ain’t always a bed of roses. Sometimes, he has to run through rough, rocky terrain. It is quite a challenge to pass through obstacles. However, it isn’t always going to be a rough run. There are smooth roads ahead too.
It is the same case with investments. You’ll find yourself in sticky situations where you have to cut down on some of your expenses so that you don’t have to halt any of your investments. Remember that you’re cutting down on your expenses to secure your own financial future. It’s worth it!
Additional Reading: Tax-Saving Investments to Grow Your Wealth
Marathon Rule 5: Your goals matter.
There are two types of marathon runners – a professional and an amateur. For a professional marathoner, winning the race is his goal. But an amateur will aim to complete the race successfully. In the end, all that matters is that you sustained till the end, no matter whether you came first or last.
When it comes to your investments, have the same mindset. It doesn’t matter whether your best friend’s portfolio outperformed yours. Maybe he had different goals and a higher risk appetite compared to you. Whatever it is, we just wanted to say that it doesn’t matter, or rather, it shouldn’t matter to you. As long as your investments are aligned to your financial goals and they are performing well, there is nothing to worry about.
Marathon Rule 6: Never ever give up.
Running a marathon, trust us, is not a piece of cake! It is very important for a marathoner to be determined and strong-willed if he wants to complete the race. There may be setbacks, but these shouldn’t deter your confidence or make you lose focus of your goals. If it does, you will probably never be able to succeed at anything.
As far as investments are concerned, there will be times when the markets are down and your funds may be performing poorly. There may also be times when you are faced with emergency situations that may force you to liquidate your investments. These shouldn’t stop you from continuing your investments though. Always remember that you have been investing for specific goals.
Finally, we would just like to tell you that investments are your best bet to achieve all your financial goals, no matter how hard investing may seem. If you really want to live the life of your dreams, adopt some of these investment lessons. You won’t regret it.