Invest without your banker

Investissez sans votre banquier

“Do you know what’s in your life insurance/pension savings plan? “. In my experience, over 90% of people don’t know what’s in this type of financial product. This also applies to more basic concepts, such as inflation. For example, a 2015 Standard & Poor’s study found that 50% of the French population was unaware of this concept. However, for many months, we have seen our various bills increase very significantly. Not to mention that your banker may be telling you that it’s a crisis and that your portfolio has lost 15% or even 20% since the start of the year.

So what should be done? It’s time to take care of our savings. Too often, anything that revolves around money, we tend to procrastinate on those tasks. It is rather paradoxical since we try to take care of our friendly, family or romantic relationships. We take care of our body by doing sports and our head by being accompanied by a person whose job it is. We also take care of our place of residence and our material goods. So why is it so hard to take care of your savings?

First of all, in our Judeo-Christian cultures, talking about money is frowned upon and uncomfortable. How do we want to improve everyone’s financial education if we don’t talk about it and if we are not in a sharing economy? Then, a huge myth remains: you have to be rich to invest (and therefore take care of your savings). This is only a myth since today platforms like Trade Republic allow you to invest efficiently from €10 per month. Finally, a popular belief is well anchored: you need to have a BAC +10 to be able to take care of your savings. If you start from 0, about fifteen hours will allow you to start taking care of your savings independently.

So, where to start? Try to invest 10% of your net salary every month. You may be able to do this by reducing some of your expenses, for example. Some people I support tell me that part of their expenses are related to a need that is not met on their side, and not related to a necessity. In addition, investing every month avoids asking the eternal question: “Is this really the right time to invest?” “. But be careful, do not invest in individual stocks. Indeed, it requires a lot of time to choose the “right” actions and not to choose the “wrong” actions. I experienced it myself at my expense between 2013 and 2015, a period during which I lost 60% of my investments. Next, it is important to understand that 85% to 95% of professional bankers and managers are unable to beat the stock market in the medium and long term, according to numerous studies. This is why I advise you to start investing in passive management (also called index funds or trackers/ETFs). The idea of ​​passive management is to follow, for example, the performance of the French stock market index, the CAC 40. No more, no less. While active management will aim to beat this index (this is an example, I do not recommend financial instruments in France). Finally, do not waste your time with your crystal ball trying to predict the behavior of the stock market, it does not work. In other words, it is impossible to predict when a stock market crash will occur. Let’s have the humility of not knowing and, above all, of not being able to control. The stock market is unpredictable, period.

When thinking about your savings, remember that you don’t have to be a financial analyst to go public and invest on your own. The resource needed for this is time. Fifteen hours may seem like a lot. And at the same time, that represents 15 minutes a day for two months, that’s pretty reasonable, isn’t it?


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