My Best Friend The Money Zombie

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I have to admit, the resurgence of the zombie genre in film and television is a lot of fun. Creepy? I guess so, but I don’t take things so seriously. The overall theme of this post is inspired by the zombie blog stylings of Michael Dinich, who runs yourmoneygeek.com

You’re probably wondering how or why a zombie could teach you anything. Well, the zombies are wondering the same thing. I have pieced together a few thoughts and took a slight break from The Money Guy and I’m channeling my inner Money Zombie.

1. Be persistent – Never give up!

If zombies are nothing else, they are persistent. Even with bodies in full decay, they’re stronger than they were when they were alive.

From time to time, you’ll pick a real loser of an investment. It might be an overpriced rental, a house flip gone wrong, a stock that tanks after you put a lot of money into it, or maybe it was a poor decision you made to sell out of fear when you should have held on.

If you’re new you might be tempted to run or give up. It would be great to never make a mistake, but that’s impossible. Instead, take the time to learn. Ask questions and understand what happened, what warning signs could have prevented the mistake, or even just change your perspective. Perhaps it will help convince you of the type of investor you want to be. The bottom line is don’t give up.

2. Slow and steady OR fast and active?

Have you ever noticed the differences between various zombie shows and movies? The most glaring differences I see have to do with speed. There are the classic slow and steady “walkers” from The Walking Dead and the incredibly fast and active zombies from World War Z.

Slow and steady passive investing

If you want to get rich I think the best course of action is to get rich slowly. What does that mean? To get rich slowly you will need to follow a strategy that focuses on simple long-term diversified investing.

J.D. Roth of getrichslowly.org lays out this solid Get Rich Slowly Investment Philosophy

Start early Think long-term Spread the risk Keep costs low Keep it simple Make it automatic Ignore everyone Conduct an annual review

The fast and active investor

Active investors had better be fast! Active investing is just that, active. It’s very involved. Passive investors buy in when they see great long-term potential. Active investors are looking multiple times a day for short-term gains they can capitalize on quickly. Active investing is typically much more expensive than passive.

There is a place for both types of investors in the marketplace. It’s important to understand that today’s winners can become tomorrow’s losers. Your goals and how much risk you’re willing to take plays a big part in deciding your investment strategy.





3. There’s no such thing as a sure thing

Zombies always end up teaching the living that there’s no such thing as a sure thing. No matter how strong the wall or shelter is, zombies always end up overrunning it. What was once a safe haven and a refuge is now ruined. What was a place where people could survive and thrive, they leave a smoldering heap as they make their daring getaway.

Investing can be similar. We’re talking about risk. Risk will always be there. There are some people who think the stock market is so risky and bound for complete failure, they would never be caught opening an investment account. Most people judge there to be far less risk in stocks and stock-based funds, so they build up their retirement nest egg using that strategy.

There are some people that leverage a great deal of debt to buy rental properties. Other people judge this to be insanity because of the fear of risk due to debt. Extreme failure or extreme success is not guaranteed, but it’s not impossible either. It all comes down to managing the risk of your investments.

How do you manage risk?

I manage risk by educating myself on the past performance of funds, the strength of various industries, and understanding the element of time. I also manage risk through diversity. Make sure your eggs aren’t all in one basket.

I watched one company’s stock drop from about $70 per share to $35 in a couple of days, then a year later drop from $40 to $17 in a couple of days. That stock is hovering around $26 right now. If you were 50 years old and had all of your retirement savings in that stock how would you feel right now? Managing risk is simple and needs to be on every investor’s mind.

4. Misery loves company

The stock market goes in waves. When the market is down you can expect someone to try to convince you to have a ‘woe is me’ attitude. Like the zombies in your favorite show or movie, they’re miserable. Don’t wallow. When people try to give me the news that all the U.S. markets are down for so many days in a row I reply back with, “If you haven’t sold anything, you haven’t lost anything.”

Try to look at investments as shares not dollars. As long as the investment has something real behind it the odds are in your favor that it will rebound and be better than ever.

5. Listen to everyone, but trust no one

If there’s anything I have learned from the awesome television shows Z Nation and The Walking Dead, it’s that things are not always as they appear. The person that seems to know it all is really running a scam and the benevolent newcomers are looking for some way to steal from and imprison you.

I’m not saying anything that dire is happening in real life, but there is deception out there and there’s quite a bit in real estate. Not so much in buying and selling homes or commercial property, but more so in land. You have all heard about the prime Florida resort land that’s really in the middle of a swamp or the up and coming deal you can get in on at the ground floor.

If you listen close enough the deceptions stick out really quick

There are also deceptions that are unintended, but still dangerous. The friend or family member who knows something no one else does. They have an inside line on what the next big thing is and they try to convince you to go in on it with them. Right now I’m thinking about currency speculators. Don’t do it, folks. There are deals out there that are too good to be true and usually, they prove themselves out to be false.

6. Don’t be distracted by loud and shiny objects

If you’ve ever seen The Walking Dead you know that zombies have some sort of mega hearing. They also react with a seemingly insatiable love for flares, explosions and fire. That last part actually sounds more like a group of Boy Scouts. Anyway, what does this have to do with investing?

Sometimes we get lured into investing in the latest and greatest thing. Two sayings come to mind; “You can’t win if you don’t play” and “Play stupid games, win stupid prizes.”

It’s true that the biggest returns often come to those taking the biggest risks. The key is to never risk what you can’t afford to lose. That’s the bottom line. For most of us that’s not a huge chunk of money. I just bought $35,000 worth of stock in a company that I believe may double in value when the overall market rebounds and as a few internal issues are resolved. Why $35K? Because it’s the most I thought I could lose without hurting my overall portfolio too much.

If you watched the flame of the meteoric rise of bitcoin, heard the endless drumbeat telling you this is the currency of the future and decided to go all in a year ago, you’re probably kicking yourself pretty hard right now.







7. Learn, adapt and survive

Education is the key

In order to survive and thrive in the cruel world of the zombie apocalypse, a self-taught masters course in survivalism is probably necessary. To survive and thrive through investing you’ll need to be able to learn and adapt.

Educate yourself on investment types, philosophies, strategies, history and current affairs. Read a lot of books. Ask a lot of questions. I’m currently reading The SmallIvy Book of Investing, Book 1: Investing to Grow Wealthy, by Joseph Sheeley . It’s a great read. I’m learning a lot already and I just started on it a couple days ago. SmallIvy.com is also a great investing resource.

8. The best course of action may be the opposite of your instinct

I definitely wouldn’t say instincts are wrong a majority of the time, but with investing sometimes instincts lead us to incorrect conclusions. Education and adaptation are so important because sometimes our instincts are wrong. When we see a big drop we get tempted to sell. We can also get greedy and make a poor decision that we have to live with for a long time.

9. Don’t bury your head in the sand

I don’t know if zombies bury their head in the sand, maybe they just tend to lose their head. In any event, if you lose your head or bury it in the sand there will be consequences. Many people are afraid to make a mistake with money so they bury their head in the sand and refuse to look at the possibilities out there. Equally bad is never evaluating your investments. I agree with many long-term investors that don’t check their accounts often, but it is smart to evaluate your investments, overall market performance, and other options annually.

Do you have what it takes to survive your own investments and the ZOMBIE APOCALYPSE?

Leave a comment and tell me what you think.





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