How is cleaning erasers and investing similar?

I don't know why or how Beth Shumate (my 3,4 and 5th grade teacher) did it but she taught us how to clean the erasers and enjoy it.  In fact it felt like a victory to get chosen to clean the erasers.  For those of you who don't know, that meant getting the chalk dust out of the eraser and the way to do that was to pound them on the sidewalk outside the building.  Dust would fly everywhere and your clothes and hands and arms were covered with white dust when you were done.  It was particularly a high honor if you got to clean the extra long one with the bull hide on one side.  That eraser was about 12 inches long.  Another fun aspect of it was you could make designs in chalk all over the sidewalk and you could not get in trouble for enjoying the labor of it.  

So how is cleaning the erasers similar to investing?  There are actually a lot of similar characteristics.  Number one, you really need to enjoy it.  Second, you need to be focused and get it done.  Third, your investments are just like those erasers, they need cleaned and adjusted sometimes.  Right now the market is going down or I should say more down than up for the last week.  Again, kind of like cleaning the erasers, you have to go up and down to get the job done.  

From the market perspective when the market is down is the best time to buy.  This is the same as when there is a sale at Penny's, it is time to buy.  Have you ever heard of buy low and sell high?  That is the right formula.  What is strange to me and probably because I have been in the investment business for so many years, is that most folks seem to want to sell when the market is working its way down.  Personally, when I see a drop in the market I work really hard to be a buyer.  And yes, I have bought a lot of stocks all the way down.  Now I do not buy a company that is going down when everything else is going up or visa versa.  This is called "dollar cost averaging"  and you can look it up on the internet.  I also want you to know I am not recommending you do what I do but I do recommend you getting a good financial advisor and if you don't have one or don't know if yours is a good one, give me a call or email and I will give you some ideas on how to figure that out.  I can also recommend a few advisors to call.

Last but not least here is a testimonial I received today:  A young lady, defined as under 60 years old, sold a property and had a large amount of money to invest.  Her financial advisor (one of the ones I would recommend you to) suggested that she NOT dump all of her money into the market at one time but rather buy on the dips (like on sale at J. C. Penny's) and do it over several months.  What she and her advisor were doing is dollar cost averaging.  Also the advisor did NOT put her in individual stocks but an ETF (look it up, exchange traded fund).  

Thanks for listening,

gary

gary@mylifelegacy.co

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