It amazes me that people who have been phenomenally successful in creating and building valuable businesses - people we call "good businessman" - are often bad investors. And not just bad investors in the sense that they make lousy investment decisions (they do that also, but that is a post for another day). But bad investors in the sense of not knowing the price they pay for financial services and not knowing the pros & cons of the strategy(ies) they have hooked their 'barrow to. Quite simply, when it comes to managing their financial wealth, they leave their business brains at the door. When in their business would they not carry out the requisite due diligence to not pay more for something than they need and when in their business would they not want to understand the rules of the game. For whatever reason (usually social norm because they are friends and run in the same circles) they trust their advisor is doing the best thing for them. That is a false assumption that has cost a lot of people a lot of money over the years.
A little bit of education and a little bit of knowledge can go a long way to minimizing those kinds of mistakes.
No comments:
Post a Comment