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How I became an investor.

April 29, 2014

I retired as a professor of Psychology in 1998 after 27 years of teaching. When I was working I put aside $5,000.00 after taxes every year. I opened an investment account at Morgan Stanley and bought Google shares with my Roth money, meaning that I now had a Roth IRA’s investing account, that’s simple. Any capital gain I earned could be withdrawn without paying federal tax on the capital gains. Any person who earns money can put aside $5,000.000 per year and invest it in Apple or Google or any money-making company at the right moment and get rich!

There are other ways to become an investor. Here is another one: You borrow money, buy Apple shares in the year 2000 for $70 per share and sell today for $600.00 per share. So, I hope you realize that not having money to invest is your excuse because you are afraid that you won’t choose the right company to invest in. Here is the grand psychological rule: If most of your decisions in life produced benefits: you chose a great husband, wife, house, profession, etc. but you never invested it’s time to invest! You seem to make good decisions in life. People who know how to make decisions with very little risk can become rich as investors. It isn’t the money issue, it’s what Kahneman,  the 2002 Nobel price winner,  calls System 2 thinking, which is the ability to make successful decisions. If you lost your wife, house and job, never invest because you would lose your money. The problem with people is that they complicate things. I tell the truth. My friend was getting married so he watched how his girlfriend treated her father so wonderful. He married her. She was good for him. Then he saw how wonderful  Zuckerberg treated his baby Facebook so he bought shares for $29 per share (they are now $60). Success is a very simple thing, you ignore your mind and look at reality behavior instead. Good luck, you will need it if you don’t get an “A” in understanding System 2!

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