Investor Mindset - Value #9 Seasons, Part 1

There is a season for everything under the sun according to Ecclesiastes 3 - understanding these specific seasons help us measure the implications of each season on us as the investor and the markets that we are investing in.  This marriage of observation and execution is what makes our decision making process so complex when deciding what market is past its prime, what is ripe and what ground needs cultivating.  Having said that, in our worldview as followers of Jesus, Mike and I believe that God allows us to wade in the waters of investing and do it successfully with God escorting us through Evaluation and Execution.

We like to keep the evaluation simple and divide our thoughts between answering these questions:

 

A) What season are you in?  What is the weight of the following categories on your decision making process:

1.  Mental -  This centers around current output and margin - 
How am I doing with my mental margin?  Am I mentally maxxed out or fatigued by work or life at home or , in this day and age, the weight of social media?

2.  Emotional - this centers around your EQ - how are my relationships?  Am I able to offload stress?  do I have the right support to make sound decisions?

3.  Physical - Am I exercising and eating right for my age category?  Am I moving appropriately to retain flexibility and range?

4.  Spiritual - Am I connecting with God and hearing His voice to better understand myself, my environment and His will for me.

5a.  Cash/ Budget  -  the answers to the questions above will provide a good barometer of readiness for the markets but this barometer will be the best marker of readiness as all of the above answers directly affect how you see your basic household numbers.

What is your monthly cashflow?Have you made a budget and are you sticking to it?Have you started your safety plan education with a fiduciary?  Are you executing?Are you in Debt?  How much?  What is the plan to reduce and eliminate debt?Do you have your vendors in place to be generous?Have you written out and followed the "order of investing"

For reference regarding the Order of Investing:

Narratives - As investors we must understand the impact of what we call, The 5 Meta Narratives:  Global Economics, US Finance, Politics, Civil Rights and Media/Technology

 

Mapping - When working with individuals and businesses our hope is to outline a constellation of goals, action points, gaps and relationships that will need attention and stewardship.

 

Values - the discovery and discussion of values can hone your current risk narrative while adding efficiency and congruency to your families/business goals.  Values are sewn deep into us and drive the 'why versus what conversation'.  When I know what I value most in life then I can work the narrative backwards to outline action points and investment strategy.

Emergency fund - the benefit of having a $1500 emergency fund set up to offset healthcare or automotive bills.  This is especially effective when paying off debt and pushing any excess funds to reducing debt.

Debt - speaks for itself - every family and individual needs to utilize a plan for reducing debt to prepare for an investment future.

Hedge - a safety bet meant to protect market investments.  Our discussion centered out the use of gold and silver, specifically.

Savings - self explanatory

Safety - this requires ongoing conversation and attention to the wills, trusts and insurance policies that protect wealth and wealth transfer

Cash Flow - one of many products or markets that can produce monthly remuneration for value.

Conservative Investing - stocks, bonds, annuities, 401k, IRA's etc.

High Risk Investing - futures and some options products

Wealth Transfer - we recommend working with a fiduciary to set up draws from your investment products and to protect the investments passed on to your family.

Equity Stakes - we believe that the new stock market will be holding equity stakes in small businesses.

 

5b.  Generosity - We keep "generosity" in the Cash category but we thought we would give it special consideration as, in our worldview, it is generated by a Spiritual tenet:  

have we listened to God ?have we decided how to be generous and to whom?are my vendors in place to automate generosity each month/ each week?

 

 

B) What season is the market in?  

we are covering this question in Part 2 of Seasons.

 

Resources and Mentions:

M.C. Laubscher - www.cashflowninja.com

www.youneedabudget.com

Debt reduction formulas :

Garrett GundersonDavid BachDave Ramsey