Warren Buffett and Elon Musk are excellent businessmen and investors. Warren Buffett shares his strategy for investing, and Elon Musk executes his strategy as he drifts into the social media hype.
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Money-wise solo preneur
This book gives you the essential guide to easy-to-understand tips and strategies to achieve greater financial success.
April 30, 2021 4 min read
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Many millennials make financial progress as they establish themselves in their careers and businesses. Increased income and more on-demand financial literacy content creates a growing desire to break free from financially irresponsible habits and mindsets.
With so much information available, it is not inappropriate for millennials to ask which path is the right one, and more importantly, why? And with a variety of investing apps to choose from, the ability to buy fractional stocks with no commission fees or minimum investment requirements, the barrier to entry is lower than ever.
Look for advice on what vehicles to open and what to invest in once they are open and you will likely find some quotes from Warren Buffett recommending a buy-and-hold strategy with inexpensive index funds. While this strategy is proven, it doesn’t share the same cultural cache as the cryptocurrency. It doesn’t offer the same allure as picking a single stock and then becoming a millionaire overnight with the right public figure tweeting about it.
Related Topics: How a series of Elon Musk tweets helped leading investors acquire Dogecoin, a meme-inspired cryptocurrency valued at 4 cents
In a series of tweets, Elon Musk started a chain reaction that turned Dogecoin, a cryptocurrency created as a hoax, into a money machine for many, demonstrating the power and influence of public figures on both regulated and regulated individuals can unregulated financial markets.
And who can ignore Reddit communities like WallStreetBets? Seeing a tweet of a stock pick or altcoin name can mean the difference between making overnight fortunes and a dire case of FOMO. Not only does social media amplify the communication of the next big thing, but it also powers the massive profits made by friends, family, and even co-workers. This entices the millennial investor to give up the long game and take part directly in the next social media rally.
FOMO and myopia can discourage new investors from sticking to the investment strategy that has catapulted many long-term investors into wealth by simply starting early and investing frequently. Millennial investors should take the following three steps to reduce the noise and minimize dissonance when it comes to generating short- and long-term profits.
Related: Dogecoin scares investors. Here’s why.
Create a strategic plan (and stick to it)
A financial advisor or coach can help you create a plan that can be adjusted over time to accommodate big life changes such as promotions, marriage, birth, and inheritance, while helping you plan retirement and others Keeping up to date with short and medium term financial goals. They can also be a sounding board that will keep you from making rash decisions or falling victim to FOMO.
Do your due diligence
It’s easy to make a hot selection from a group chat, forum, or tweet, but in the end it is you who take the risk. Part of the due diligence process is to determine your risk tolerance based on the asset and the dollar amount. If you can’t afford to go without that money, you probably shouldn’t be investing it.
Think long term
Although the two are often compared, investing is not a game of chance. However, anyone can use an investment platform to play if they don’t follow the first two points. When you approach investing as a vehicle for a quick flip, you are relying on two things that you cannot control: timing and the media hype. With strategy and due diligence in place, your investments will be controlled and your expectations will be realistic – growth over time, no happy break in one day with the potential to lose it all the next.