The 3 Pillars Of Successful Investing | Wealth Crafts (2024)

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What successful investing methods have investors like Warren Buffet followed to achieve the spectacular returns generated over their lifetime? How do they react to the various pitfalls during the course of their investment journey? How do they tackle market excesses and what sets them apart? We look here at the three Pillars of investing – Planning, Processes and Products and understand how the successful investors crack the code to win the game of investing.

1 Successful investing – Planning, Processes and Products

1.1 Planning – Building a strong foundation

1.2 Processes – Plans need to be implemented

1.3 Products – Planting the right seeds

Successful investing – Planning, Processes and Products

Planning– Building a strong foundation

Just like in any scenario, planning is a critical task. Successful investing starts with breaking down goals with an actionable time frame. Imagine driving without knowing your destination, you will reach nowhere for sure. It is important to have realistic goals; you can’t reach the moon even if you have the most powerful Ferrari. Size up your goals and build resources that will help you reach your destination. The right plan is the foundation to build your skyscraper.

Processes – Plans need to be implemented

The best of the plans are useless if they don’t get implemented. Implementation gets easier with the help of solid processes. Successful investors understand this and have clear cut strategy to help them achieve goals. Successful investing involves seeking professional guidance that help them avoid emotional interference and take decisions fast. They have a rule book to swear by and seldom deviate from ground rules. They understand asset allocation, valuation and re-balancing, and have fine-tuned processes to help them construct portfolios that suit different situations.

Products– Planting the right seeds

Mangos don’t grow in banana plantations. Successful investing involves doing proper homework well by collecting all relevant information. Successful investors have their facts right and use sound reasoning to take investment decisions. They do not hesitate to reach out to various experts to understand the nuances if they are not clear on anything. They nurture with great care; continuously monitoring and de-weeding their portfolio by throwing out the bad ones and give ample time to ensure their investments flourish to yield the desired fruits.

Smart investors carry a variety of ammunition in their armory and use them depending on the upcoming warfare. They delegate tasks and focus on small improvements and understand the impact of compounding on the growth of their portfolio. They keep away from market clutter and seldom get worried by what others are doing. Just like Warren Buffet, they restrict themselves to their circle of competence which protects them from taking foolish decisions and thereby save tons of money. So go ahead and implement these in your journey and grow wealth.

A SEBI Registered Investment Adviser can help you identify your goals and help you achieve them by choosing the right strategies and investment instruments. Book a Free Consultation call with our Fee Only Financial Planner today to get started today.

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The 3 Pillars Of Successful Investing | Wealth Crafts (2024)

FAQs

The 3 Pillars Of Successful Investing | Wealth Crafts? ›

We look here at the three Pillars of investing – Planning, Processes and Products and understand how the successful investors crack the code to win the game of investing.

What are the three pillars of investing? ›

However, countless studies show that long-term investment success is based on three factors: analysis, strategy and discipline. Analysis means systematically studying the markets and investments worldwide in relation to both risks and return potential.

What are the three pillars of financial success? ›

To harness their power effectively, it's essential to educate ourselves, seek guidance from wealth coaches, and continuously expand our knowledge. In conclusion, remember these three pillars: Cash Flow, Arbitrage, and Leverage. Embrace them, learn how to use them wisely, and let them guide you toward financial success.

What are the 3s of investing? ›

Investing can be overwhelming, but with the guidance of three fundamental pillars, you can move forward with confidence. These foundational pillars are Faith in the Future, Patience in the Presence, and Discipline in Your Decisions.

What are the 3 pillars of building wealth? ›

The 3 Pillars: Everyday Money Management — Saving, Spending and Investing.

What is the 3 investment strategy? ›

A three-fund portfolio is a portfolio which uses only basic asset classes — usually a domestic stock "total market" index fund, an international stock "total market" index fund and a bond "total market" index fund.

What are the 3 main investment categories? ›

Historically, the three main asset classes are considered to be equities (stocks), debt (bonds), and money market instruments. Today, many investors may consider real estate, commodities, futures, derivatives, or even cryptocurrencies to be separate asset classes.

What are the three pillars of success? ›

The Three Pillars of Success: Self-Awareness, Hustle, and Empathy - Salesforce Live.

What are the 3 pillars of planning for success? ›

The first time is when we set new goals and imagine our future state. The second is when we create a map or a plan. The third is when we manifest it in the real world.

What are the three pillars of responsible investment? ›

Read on to learn about the three pillars of a corporate sustainability strategy: the environmental pillar, the social responsibility pillar, and the economic pillar. They are referred to as pillars because, together, they support sustainable goals.

What are the 3 Ps of investing? ›

The 3 Ps of investing: purpose, plan, and patience.

What are the 3 A's of investing? ›

Amount: Aim to save at least 15% of pre-tax income each year toward retirement. Account: Take advantage of 401(k)s, 403(b)s, HSAs, and IRAs for tax-deferred or tax-free growth potential. Asset mix: Investors with a longer investment horizon should have a significant, broadly diversified exposure to stocks.

What are the three P's of wealth? ›

I will break it down using the three 'P's' of money: Personal, Pleasure & Purpose. Now each one of these categories will have a different breadth of explanation but, creating a strong fundamental foundation of thought around the concept of the dollar can actually help guide people's day to day decisions with it.

What does 3 pillars mean? ›

The three pillars are a central symbol in Freemasonry, and are believed to represent the three pillars of wisdom, strength, and beauty.

What are the three major pillars? ›

The 3 pillars of sustainability: environmental, social and economic.

What is the 3 pillars system? ›

The three-pillar system has been enshrined in the Federal Swiss constitution since 1972. It is based on the interaction between state protection of basic livelihood, occupational benefits insurance (which includes employers), and tax-privileged private pension provision.

What are the three components of investment? ›

But there are also several components to an investment. Specifically, time, capital, and profitability. Time is the period that you should expect to hold an investment. You might have heard this referred to as the time horizon.

What are the three pillars stock? ›

We consider volume, volatility and spread to be the three pillars of trading in that they are the primary factors driving both strategic and tactical trading decisions.

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