understanding the big picture is the key to succeeding in investing (nerves of steel help, too)

This is by no means a financial blog.

But in my studies I have found that money, or more appropriately, a lack of money is the root of many of our problems which is why each of us should make money a priority.

I think Kim Kiyosaki (wife of Robert Kiyosaki) said it best in her book, Rich Woman, when she said, “Many people say that money is not the most important thing in life. That may be true. However, money does affect everything that is important – your health, your education, and your quality of life.”

Money helps us take advantage of what’s around us all. And here’s the good news – there are so many ways to make money.

You could get a job, create a product, paint a masterpiece, offer your services online, pass along good ideas and, of course, the holy grail – invest.

Every successful businessman has either invested in stocks, real estate or their own business because they understand that investing is the real key to wealth and fortune.

But investing isn’t for everyone. In fact, I am surprised at the variety of reactions I get when I bring up the idea of investing.

Some people’s eyes light up, some people could care less and some are absolutely terrified.

As a young child, I admit I was in the second group. I could have cared less because I couldn’t see what was in it for me.

But that changed in my early thirties when I sat down and did some simple calculations. My conclusion – there has to be a better way to make money than a job.

Years back my boss told me that the acronym J.O.B. stood for “just over broke.”

I laughed when I first heard that but over time I was shocked to find just how true that is.

A job makes us a living.

Everything else is up to us.

In the late 90s people were becoming rich left, right and center thanks to the Internet boom only to see much of that wealth disappear in the crash of 2000.

Then came the housing boom with made many people very wealthy.

Enter Lehman Brothers, which ended up wiping many of them out in one fail swoop.

And here we are.

Many people are still nursing their wounds from their battles waged over the past 11 years.

But here’s something to consider – Sir John Templeton understood the value of buying when no one else is.

He invested in Japan after World War II when on one else would. His gamble paid off nicely as it made him the first billionaire investor.

The key is not seeing the way things are but how they will be.

And you can only do that through experience and nerves of steel.

Take my personal experience.

Four years ago I started looking into the various investment vehicles out there.

I took a look at Forex (too confusing), stocks (too unpredictable) and commodities (figured what the heck?!).

The more I read and the more I studied, the more I was pulled towards precious metals.

They made sense to me so back in Mar 2008 I decided I was ready to take the plunge and decided to make my first real investment.

I went with silver, which at the time was $16. Then it jumped to $21 in a short period. I was ecstatic.

Then it plunged to $9.

I freaked out!!!

I had just lost 50% of our investment.

Then I thought about it and went “Hey, this is a great opportunity.” So I bought some more.

But I wasn’t satisfied and had been waiting for a cash infusion to invest. Earlier this year it was $40 so I bought only to see it plunge to $26. Sob sob. But I didn’t sell. Nor did I panic.

With my next infusion I bought again just the other day at $35. I was tempted to wait to see if the price would drop, but then I asked myself one question – WHAT IS THE BIG PICTURE?

The big picture is this: Today, many of the so-called first world nations are in debt up to their eyeballs. American, Japan, France, Italy, and Greece to name just a few.

Their only solution so far has been to print more money as far as I can tell.

What might surprise people to know is that it took America roughly 200 years to go from $0 in existence to go to $825 billion, but since Lehman Brothers crashed it only took 3 years to triple that number.

All that money has to go somewhere and I believe that eventually it will show up in the form of inflation. And if inflation takes off them people will scramble to maintain their wealth and most likely turn to gold and silver as has been done over and over throughout history.

I mean, if the price of silver’s going to $60 – $100 or higher (which many people in the industry believe – Mike Maloney, James Turk and Rick Rule), who really cares if you buy at 40 or 30.

Sure, 30’s nicer. But with the speed at which things are unraveling (first Greece, now Italy) these days I just wonder if one night I’ll go to sleep only to wake up a few hours later and see the price of precious metals double or triple.

It may seem farfetched based on what we have seen so far, but when I look at the fundamentals and the situation we are in, it could very well happen.

That was my reasoning for investing in precious metals and I stand by it today.

Will it happen? That I can’t say. No one can. The best anyone can do is make an educated guess.

The rule is always buy low and sell high. The problem is people panic when their investment drops, if you’ve bought it because of fundamentals and sound reasoning then that drop should be an invitation not a death sentence.

What we must understand is that while investing can pay off big there is a time element involved. Just as the farmer must wait to reap his harvest, so must the big picture investor.

One final piece of warning – just as you wouldn’t follow just anyone into battle, neither should you when it comes to investing. Take the time to study from a variety of sources and then take action based upon your own conclusions.

Plant your investment seeds today. Begin by educating yourself, then be willing to take some risk.

With any luck it’ll pay off big.

Adrian Shepherd

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