Good morning, good afternoon, good evening. Depending on the part of the world you’re in. This is Jonathan Satovsky of Satovsky Asset Management and on today’s episode of “Seeking Wisdom, Wealth, and Wellness,” I want to talk about saving and investing for the long-term, particularly when times are scary.
The concept of dollar-cost averaging is that you’re buying every month, every week, at varying prices. You don’t know that today the price is high, the price is low, you don’t know, you’re not going to know. Prices, like the weather, are going to change day to day, week to week. But the process of investing and staying consistent even when times are tough, with a philosophy and a discipline that you understand, that makes sense, that you can do sustainably, every time prices fall–if you’re systematically saving, it’s like mana from heaven. You’re actually getting more.
It’s like the analogy of tuna fish. I can buy StarKist or Bumble Bee. Well, if I didn’t discern the taste difference between Bumble Bee and StarKist, and the latter was three for a dollar, why wouldn’t I take more StarKist this week? It’s just not the same for the mind. People can’t relate to the same mindset when they’re viewing their investments.
So think of tuna when you’re thinking about your investing process and stick to the plan. Stick to the path, systematically, regardless of whether prices are high or low. That’s on the accumulation. On the decumulation side it’s a little bit trickier for sure because the pleasure-pain principle is a dollar to every two and a half dollars of pleasure-pain but we’ll cover that in another section. Today, just keep on your path, save, be disciplined in a process and a philosophy that makes sense, that’s sustainable for multiple generations.
Have a great day.