In Control of Fear – II – Investment

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To do investment is nothing different than to ski. I say that to invest in real estate in the long term is like to go ski. We have the immovables ( properties ) as the solid base that we can see and touch all the time, just like having  the earth under our feet when skiing. In ski, the better the professor’s coaching skills, the longer we ski step by step, the stronger we can control our fear, the better we get, day by day and year by year; in investment, the better our adviser’s opinions, the better foot we start on our business and with time, the better we get! Just for fun here that I think to invest in stock market is in all sense very similar to Sky Diving, which is very abstract, largely based on frequently changing  information and which requires a much more bold mind and explicit delicate precise techniques to be a winner. One thing very different though is that sky diving has one out of a million who fails, but investing in stock market without an adviser or with a bad one, will end up 100% failure!

Investment is new to us Chinese. Just by looking at our parents and our schools we know that we are green hands. We are all alone here to learn by ourselves. We do not have much legacy from our ancestors who valued Agriculture while despising commerce. In our concept, we still viewing money as part of our moral rather than just a machine to work with or many of us( not limited to  Chinese)still indulge in enjoying money as a main factor to satisfy our greed or release  unhappy feelings! In another word, many think that we are unhappy because of not having enough money! We know that money is not everything, especially in our modern world where basic living has become not a question, yet money is an important tool for playing interesting games to explore the unknown corners in our mind and challenge our fear!

My parents had no idea how to play with money. Of course they didn’t have much to play with the first place, but they have extra as retired teachers and they could do something. Instead, they put their money in their saving’s account, the nature of which is like standing on the ground, to be more precisely, on a downhill watching the train passing by. In another word, their money has always been dead while if invested, the money is alive. If the money is not Benjamin Button, then it is going to grow with time like us people growing up with time.

My parents’ not investing has their reason. The reason is fear. They think they have no experience in doing such things that they have zero knowledge in. I think they haven’t changed the traditional mentality about money and haven’t understood the nature of money which is that  money is alive and they are people who basically do not want to explore much in life because it is not necessary and they do not trust anyone.  All their life, they made their decisions about money out of emotions which is naturally and basically controlled by  fear!

I did my first investment in buying my first house and moved my parents there from their city. They lived in my house and their house in their city was locked up. My mom was complaining that they spent too much money traveling between the 2 cities ( 6 hours of train ) and they felt troublesome having to go back to read the meters and pay fees. They are people who would always feel afraid if they do not have some money in their pockets ( which is natural to absolutely most people, especially Chinese who never have much social financial support ). So I asked them to sell it, which was a very bad idea! Anyhow, it was a choice we made to avoid trouble, nothing wrong about that. But the problem appeared after we got off the moving train ( sold the house and got the money off the market ) and then forgot or were not conscience enough to get on another train to keep the money alive!!! Duh! But for some time, they felt rich and secure at least!

My brother wanted to buy a new car. He paid a big sum of deposit before knowing that he could not borrow money from the bank because of his unstable musician job! In order to save this deposit, my parents decided to lend him 50k which was scarcely paid back. 10k, so what? What is losing it so fearful? Losing this money is better than getting into this complicated parents and son relationship where they could not force him to pay because there was no contract for the loan and he was not having enough money all the time and it was the son’s problem the first place! Car is a movable, it depreciates very fast. In 5 years, a brand new car is worth almost nothing! Plus, it is a big consumer, gas, repairs, parking, annual fee and insurance, you name them! A car then is worth 5 years salary of a retired teacher!

My brother divorced! His wife wanted to leave and he was stupidly enough to give her their house, on which he put all his money! His wife is a doctor and he still is a Gipsy! I knew then that it was better for him to buy a place. So I “lent” him the down payment, and we bought him a condo. I lent him the money not as a banker and I knew he couldn’t before doing it.  I was not upset that he couldn’t pay me back, but I did get really upset when my parents again decided to put another 50k to reduce the monthly payment to avoid paying too much interest! Now, my parents have almost no money! What will happen if my parents are sick and need a big hospital deposit? Even though they have medical care, they need an emergency fund!! They have no family there, their former employers are 6 hours of train away, plus both their children are not with them!! This was an painfully bad decision again! To be afraid of paying more interest in later days caused their security fund right now and forever, not mentioning the potential financial impact on their daughter who now has to take into consideration of the possible consequences of this action!??? How smart was that? I just wonder how strong is this fear which controls people’s mind in making decisions even though there was a person ( me ) who definitely was against it and how stupid it could be to love saving for ourselves in petty minor ridiculous ways as such!!!

So, wake up, people! Wake up, us Chinese! Be true smart and be generous! Money lost is money gained somewhere else! Look away from the small places where we lose small money, look at the big place where we will gain much more!  Think with your head, control your fear in our heart and learn the techniques! Eventually, be generous and detached about the results! We can not have all in our life and it is impossible and vicious to gain all in our life! Look further and think further! Find good knowledge and information resources, trust, be serious and respectful!  Think true smart for ourselves and think true smart for our communities! We survive better when we think better and act better!

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