It is ski holiday week in Finland, so the office is a little quieter than normal, as quite a few people have taken the time. This was my going to be my first ever ski break, but I chose not to take the week away and will instead have it in the spring or summer, as I don't see the point in taking it at the moment, as I don't have anything special to do at home, but have plenty of things to do at work. Like normal these days, I talked with colleagues about life, employment and investing.
One of the things that enriches my working experience, is the ability to talk to domain subject matter experts about things outside of their domain. It is valuable to have a strong group to converse with and reference, as they can become influencers of direction, or be influenced.
The reference group is an important aspect of our lives, as peers are highly influential in our own view of the world and will affect our behavior - for better or worse. Having a good reference group can empower us, a poor one can hold us back from reaching more of our potential.
Talking about this in relation to investing, I was saying to my colleague how I do not come from an investment mindset and my parents definitely didn't encourage or demonstrate good financial literacy or hygiene. If anything, they were the antithesis of a good start into the world of finance and economic responsibility. As a result, I didn't take much responsibility myself, which got me off to quite a slow start as I didn't understand much and therefore, my "intuition" was not attuned to investing.
It was only once I joined Hive that I really started educating myself and once I did, aspects of finance, economy and life in general started to become far more apparent - rather than things happening to me blindly, I began to understand what they were and my role in the outcome. It really is easy to blame others for a lack of opportunity, but that is the intuition speaking - an untrained intuition.
Intuition is not something mystical, it is our experience pattern detecting and informing us through feeling. The better our experience, the more sensitive our intuition becomes, giving more precise directions, faster. It is like someone who has practiced something a lot like a sport, where the moves get into position and act "automatically" without conscious thought having to drive them. I think this is similar when it comes to the mindset of investing, as people develop habits that support their ability to invest themselves.
As I was saying to my colleague, I had two major problems when investing.
- Not having the capital to invest when I spotted an opportunity
- Not being willing to pull the trigger when I spotted an opportunity and did have the capital
Not having the capital is part of the financial hygiene, as it relates to spending and saving habits. Not taking the opportunity is about my aversity to risk, as I never felt I "had enough" to invest. This is part of an incorrect intuition, where I thought I would need a lump sum to get into the investment pool, which I never had because of bad financial hygiene. It was a negative cycle of not being able to save enough in order to be able to have enough to invest.
What broke it was finally getting the understanding that "lump sum" wasn't necessary, small amounts were enough. This allowed me to find ways to make changes to my behaviors that gave a small amount of disposable income often enough that I could put it into investments of some kind. The aversity to loss was still there, but because it was small amounts that I was putting away often, it was easier to part with and lock up.
As said, we were talking about reference groups and the reference group that affected my behavior was on Hive, where pretty much everyone is interested in investing to some degree, even if it is simply their time. I count myself lucky.
The problem is that most of the world do not have a reference group like this and much of the world are surrounded by people who are continually reinforcing a scarcity mindset, as well as poor financial hygiene. Economic role models in many communities are largely non-existent, making a lot of the behavior generational, where ownership and responsibility of experience are not the norm.
What I have found, is that while a lot of this stuff is obvious for some people, many do not have the intuition for it, yet feel that they are making the right moves. For example, one of my colleagues always believed like me, he needed a lump sum to invest and it wasn't until a few years ago that he realized this wasn't the case. Unlike me, Hive wasn't his driver, it was his colleagues, the friends he made in the company that he influenced his thinking as they built social relationships. This didn't happen right away, it took a couple years before he made the shift and then another year or so of me discussing things with him before he started diversify into crypto.
I have always maintained that "we are what we eat" in the way that we are affected by our surroundings, making what we choose to surround ourselves with, vital to our behavior. While we can't control everything in our environment, we do have some control over the information we choose to eat, including that which comes through our peer groups. Birds of a feather might stick together, but it is important to work out whether that is a chicken or the egg scenario. Do like minds gather, or because they gather they become like minds?
Personally for me, this journey into the world of investment has been life-changing, even though from the outside looking in, my life hasn't changed much at all. We tend to compare ourselves to each other, but I think it is far more valuable to reference each other instead, so we can onboard the useful, dispose of the harmful and help each other grow.
Taraz
[ Gen1: Hive ]