Why 'not investing' will ever be people's biggest mistake

Good morning, let’s get into it!

So, 2 weeks ago, I invested in the NewGold ETF as it was trading at P570.00 with my friend. But then it dropped to P545.00 after I invested, and later it dropped again to P513.00. Just yesterday, I discovered it was up to P570.00 again.

During that time, my internal feelings were that of feeling like it wasn’t going according to plan. But I have been too aware for long to know that this drop is just what should happen, because volatility is the price to pay in this game.

I’m not entirely surprised, but I am pleased that it turned out good. Most people often fear investing, no they don’t know how to invest. They don’t see the benefits and still think banking money is the safest option. But they stay stuck in the rat race, working very hard for money and saving it in banks long-term. That’s like carrying a wheelbarrow full of 10.5 kg of maize meal, rice, and flour up a steep hill. Because of inflation, all that effort is neutralized; this is not a good idea in an economy that grows in inflation at 3.6% a year.

To add on that, most people (men especially) think that the worst thing to do with money is to waste it on women and alcohol or a nice car. No, if you spend 10k on women in a club, that’s all you will lose, 10k. But if you don’t put 10k in investing, you lose more than the 10k (principal), you lose the interest as well (compound). e.g, 10k in NewGold ETF, you would have lost out on a return of 70.1% at P13 700.

That’s almost 4k extra loss! Think about that, if we expand on a longer time horizon and you invest 10k a year for 6 years, that would be P142 100! Instead of only P62 000. (given the returns are the same at 37%)

Do you see this insane difference? Those bad financial decisions that you often cry about in spending all your money on clothes, vacation, phone, and relationship, pale in comparison to this one.

The rat race will have you working hard for money, and the fast lane will have your money outpacing the effort you would ever put in for the rest of your life.