Retiring with millions in your savings and investment accounts is a dream that not many would get to live. That shouldn’t deter you from shooting for the stars though.
Take inspiration from writer Eric Rosenberg’s grandfather, a retired business school professor who put his learnings to work and retired with a portfolio balance of over $1 million.
Here are three things you can do today to boost your long-term investment results.
Do Your Research
Rosenberg learned from his grandfather how important it is to understand the companies behind the stocks he buys. Thus, he wouldn’t pick stocks based on just market trends.
While prices tend to go up and down often, it is a company’s total intrinsic value that determines its stock’s value. His grandfather made a habit of studying a company’s revenue and profit trends before buying into it.
The good news is that you don’t need a degree in business to do this, too. As long as you understand how a certain company has been performing or how it makes money, you can make informed decisions about your investment portfolio.
Monitor Your Investments
Rosenberg shares memories of coming with grandfather to the bank so he could look up stock prices and track his portfolio’s performance.
While the Internet has made this task much easier these days, the thought behind it remains the same. Knowing the value of your holdings would help you make decisions about which stocks you might want to let go and which ones you need to hold onto.
This applies even if you’re practicing the buy and hold strategy as some stocks’ performance justify selling them earlier than you initially planned.
Keep Track of Your Spending
Investing more increases the returns you’ll get in the long run. Rosenberg’s grandfather certainly knew this and made it a mission to spend every dollar thoughtfully.
Even though he had the money to splurge on material things, he chose to build his wealth through investing his extra resources.
He encouraged Rosenberg to do the same by giving him an accounting ledger notebook when he was eight years old. Using the notebook, he taught the author to keep track of the money he made and spent, a lesson Rosenberg found handy when he started building his portfolio, too.
While not all of us are as lucky as the author to have a finance-savvy grandfather, you can take these investing lessons from Rosenberg’s grandfather and get on track to retire a millionaire someday.
