Graeme Quote: Get Rich Quick
Why do we continually fall for the temptation of get rich quick?
It’s because our money choices are primarily motivated by our instinctual caveman brain. Unfortunately evolution has optimized our very out-of-date brain for the problems faced by hunter-gatherers. When our caveman ancestors made a kill, it was important that they gorge themselves. Why? Because they might not find food again for a long time.
So what happens when we have a win in the market? Our instinctual brain compels us to buy more. We do this at the worst time, when that investment is most likely to be overvalued and primed for a fall.
On average, the Dow experiences a major correction every nine years. Leave the experimentation on things like cryptocurrency to the daredevils. Your job is to invest every month, and to realize that the most powerful killer of wealth is not market fluctuations. The most powerful killer of wealth is your caveman brain and its lack of discipline.