Squeeze the Stone

Michael also wasn’t trusting the principle that time creates money. The first thing you need to know about investing is that there has never, in the history of the stock market, been a ten- year period of time during which stocks have not outperformed every single other investment out there, regardless of the day that you invested. Even if you had invested in a variety of stocks the day before the October 19, 1987, crash, when the market went down five hundred points, ten years later, had you left the money there, you would have made far more than with any other investment. At forty, Michael had twenty-five years for the money to grow before he would turn sixty-five, well more than the ten it generally takes to watch your money really grow. I am always thrilled for myself and my clients when the market goes down and we have money available to buy more shares.
The best investment advice I could give Michael was to go back into the 40 1(k) and take that $750 he wants to put into it every month. But this time he should diversify the money among two or three other good funds in the plan, be patient, and wait for time to touch his money.
This kind of investing is being respectful to what you have and respectful to what you want to have. It is not going out on a financial limb or taking a gamble with everything you have.
But you also have to watch over those things that whittle away at the money you want to create. You must also be respectful to the money you don’t have.

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