Fidelity: 6 Habits of Successful Investors

[38Chevy454]

Saw this on my Fidelity feed. Six Habits of Successful Investors.

Six habits of successful investors | Fidelity

These simple habits can help increase your investing success and achieve financial wellness, even when financial markets seem unfriendly.

www.fidelity.com

Summary of the 6 habits and conclusion of the article. Basically same as what is stated on the E-R forum here regularly. Not rocket science, just good sense.

1. Start with a plan​

2. Stick with your plan, even when markets look unfriendly​

3. Be a saver, not a spender​

4. Diversify​

5. Consider low-fee investment products that offer good value​

6. Don't forget about taxes​

The bottom line​

Investing can be complex, but some of the most important habits of successful investors are pretty simple. If you build a smart plan and stick with it, save enough, make reasonable investment choices, and be aware of taxes, you will have adopted some of the key traits that may lead to success.

 

[MichaelB]

Sounds pretty reasonable.

 

[frayne]

Pretty much sums up most of the folks here and is common sense, that is not so common for many.

 

[Exchme]

Pretty basic stuff, a couple of nuggets for those that didn't click through (copying the minimum to make the point):
1.Financial planning doesn't have to be fancy or expensive. You can do it with the help of a financial professional or an online tool like those in Fidelity's Planning & Guidance Center.

2.[regarding the 2008-2009 Financial crisis] More than 25% of those who sold out of stocks never got back into the market and missed the gains that followed.

3.In 2023, America’s retirement score is 78.3 down from 83 in 2020. [meaning] the median person who is saving for retirement is on track to cover 78% of their expenses in retirement. [and those not saving are far worse off]

4....a portfolio that delivers growth potential with a level of risk that makes sense for your situation, may make it easier to stick with your plan through the ups and downs of the market.

5. Savvy investors know they can't control the market, but they can control costs. [Morningstar survey showed low cost funds did better]

6. [Regarding tax treatment, they recommend] putting different types of investments in various types of accounts, based on the tax efficiency of the investment and the tax treatment of the type of account.

 

[MarieIG]

As noted in OP's bottom line, one should start with a smart plan.

 

[Koolau]

Saw this on my Fidelity feed. Six Habits of Successful Investors.

Six habits of successful investors | Fidelity

These simple habits can help increase your investing success and achieve financial wellness, even when financial markets seem unfriendly.

www.fidelity.com

Summary of the 6 habits and conclusion of the article. Basically same as what is stated on the E-R forum here regularly. Not rocket science, just good sense.

1. Start with a plan​

2. Stick with your plan, even when markets look unfriendly​

3. Be a saver, not a spender​

4. Diversify​

5. Consider low-fee investment products that offer good value​

6. Don't forget about taxes​

The bottom line​

Investing can be complex, but some of the most important habits of successful investors are pretty simple. If you build a smart plan and stick with it, save enough, make reasonable investment choices, and be aware of taxes, you will have adopted some of the key traits that may lead to success.

Kinda "boiler plate" but that doesn't mean it isn't also true!

 

[marko]

As noted in OP's bottom line, one should start with a smart plan.

Yeah but how do you know if your plan is any good or if you're out in the weeds? I'd hate to be following rule #2, sticking to a bad plan!

That's the trick IMO.

 

[TheWizard]

Yeah but how do you know if your plan is any good or if you're out in the weeds? I'd hate to be following rule #2, sticking to a bad plan!

That's the trick IMO.

There are a wide variety of "good plans"; you don't need the one and only most superior plan.
Good forums like here and Bogleheads help folks devise something that fits their risk tolerance...

 

[dobig]

So what's a good plan that's also diversified?

Bogleheads 3 stock plan or whatever they're doing nowadays doesn't seem diversified enough for me.

 

[TheWizard]

So what's a good plan that's also diversified?

Bogleheads 3 stock plan or whatever they're doing nowadays doesn't seem diversified enough for me.

Total Stock Market funds have 3000+ stocks; that's pretty diversified.
But you can add additional funds to "tilt" as desired.

For instance, if you don't like the dominance of the top ten stocks in the S&P 500, then add a Mid-Cap or Small-Cap index fund.
But be aware that won't necessarily increase your total return...

 

[street]

Have a plan work the plan and keep it simple.

 

[Midpack]

As other have said, perfectly reasonable, as long as the plan makes sense. And that doesn't have to be difficult either, there are dozens of 3+ holding lazy portfolios that will work well. I'm down to 8 holdings (7 I've owned for more than 10 years), and that's more than I need.

 

[MarieIG]

Yeah but how do you know if your plan is any good or if you're out in the weeds? I'd hate to be following rule #2, sticking to a bad plan!

That's the trick IMO.

That occurred to me too - although what is a good plan for one individual may differ from what is a good plan for another (although some "aspects" of certain plans may simply be poor choices or way to risky for the majority of individuals in particular those with limited resources or an inability to deal with significant losses).

 

[Koolau]

Yeah but how do you know if your plan is any good or if you're out in the weeds? I'd hate to be following rule #2, sticking to a bad plan!

That's the trick IMO.

The most basic of plans would probably be something like a 60/40 AA with yearly rebalancing. Simple and shown to be generally effective over many generations but YMMV.

 

[marko]

There are a wide variety of "good plans"; you don't need the one and only most superior plan.
Good forums like here and Bogleheads help folks devise something that fits their risk tolerance...

The most basic of plans would probably be something like a 60/40 AA with yearly rebalancing. Simple and shown to be generally effective over many generations but YMMV.

marko said:
Yeah but how do you know if your plan is any good or if you're out in the weeds? I'd hate to be following rule #2, sticking to a bad plan

Hoping y'all know that my comment was a rhetorical one. I'm an idiot here sometimes but not that much of an idiot.