What to Invest in When the Stock Market is Unreliable
Here’s the thing about me — I’m quite bad at managing my finances. Although I have entered money into my TFSA for the past couple of years (minus this year where I went on exchange), I’m still quite unsure of my financial goals. Sure, I want a car and a house at some point in the future, but it doesn’t feel urgent right now. I’m also unsure of how to project the exact costs in the first place — after all, how should I know the average cost of rent, or even a mortgage, if I don’t even know where I’ll be working for full time yet?
What’s more is that, despite having invested in stocks ever since I was legally able to (at age 18), I lacked the skills to do proper due diligence. That is, my idea of due diligence was going onto simplywall.st, scanning the analyst recommendation graphs, and developing some “gut feeling” about if the stock has growth potential or not. Pretty shitty investment strategy, right?
So, when tech stocks took a plunge this year, my almost-all-tech-stocks, blue-chip portfolio took a huge dip. Yes, I should have diversified more, but if we take a look at the current market, it seems like the max return you can get is ~5% from either ETFs or GICs (low risk, stable investments).
All in all, these losses brought me to a realization. Why not invest in myself?
Identifying Exponential Skills
Sure, I don’t know what car I want in 5 years or where I’ll be living in 2 years. But I can focus on building the skills that will be applicable to any setting, no matter my future job or geographic location. In my opinion, skills that are at the core of anything you do are:
relationship management skills (setting boundaries, confronting differences of opinions, open Qs, sensitivity and curiousity to the emotions and experiences of others)
the ability to learn (aka getting good at getting good)
emotional intelligence (understanding my gut feeling, being aware of what I’m good at, knowing when to ask for feedback/help, being able to be empathetic)
leadership (knowing how to lead yourself first before trying to lead others — e.g. how do I set small habits in place towards bigger goals?)
storytelling (useful in interviews, in daily conversations, online for building your brand, etc.)
organization (I struggled for a long time to actually move the needle bc my ideas were everywhere and I wasn’t structuring my learning process enough)
I think the key here is playing to your strengths. For me, I’ve realized that I’m strong in emotional intelligence and that furthering this one strength could bring exponential gains to all areas of my life. For more analytical people, perhaps their “core” skill would be problem-solving or the ability to dive deep into analysis, which would help them solve problems with data AND people.
Sure, I could be focusing on building product manager interview skills right now (which, don’t get me wrong, has merit in its own right). OR — I can focus on building my core strengths which would apply to anything, thus furthering on my career, friendships, family, and relationship with myself.
I’d eventually have to build those skills, but they’re more a resulting factor and subsequent thought rather than the internal driving factor (see diagrambelow).
Although the image above is meant for product development, it can apply to all areas of life — including developing yourself.
While I do think jobs have their own merit of allowing you to apply skills and learn new things, sometimes a job is just a job. One thing I realized recently is that, in my past internships, I should have invested more time learning alongside my internship so that I could practice an iterative loop of learning (aka cycling between learning/theory, applying, and reflecting).
In my case, I questioned why my goal was to become a product manager and instead adopted the goal of developing product skills. After all, trying to continuously improve my skills in the field is much more fun than trying to get a title. The job doesn’t stop after I pass an interview and “become a product manager"; to be a truly good PM, I need to hone my discipline and practice often, like how I developed dance skills.
Sure, reading “Cracking the PM Interview” and training my interview skills are valuable, but they can fall short and feel empty if I have no base knowledge to interview off of. I don’t want to try to get a job for the sake of getting a job but rather because I genuinely enjoy learning more about the field and getting a job will align my income source with my interests.
All in all, this is to say that more focus needs to be put on the core skills at the heart of everything rather than obtaining the external results (that stem from these skills).
Ok, I get it, I need to identify the core skills I need. But how do I actually improve them?
Reading
When I looked around me at all my friends who inspired me with their hard work, what did they have in common? Their habit of reading. The most intellectual people I know are always learning something new through books, articles, podcasts, etc.
I know it’s easier said than done, but personally, I’ve found that even reading 10 pages a day makes me feel more enthusiastic about the subject and increases my sense of self-belief.
I’m currently reading a lot about leadership, storytelling, boundaries in dating, economics, and public speaking. As well, one of my favourite sources of bite-sized, jam-packed knowledge are newsletters, from personal development ones by Ayodeji or tech ones by Brian Morissey.
Development Programs
When I observed top founders and executives, they’re all investing significant amounts of money (think $20K or so) into development programs. Why else would top executives be quitting their shiny jobs to create development programs if there was no market for it?
I’ve been quietly taking note of programs here and there to keep in mind for future investment. One of the programs I signed up for recently is the Atlas Development Program.
Although I swore to myself that I never want to go back to SF again, I put in quite a sum of money to fund my trip there. Why? I want to re-center with who I am at the core and align action with increased focus. Big cost, but high potential for returns.
In high school, my mom paid hefty sums of money to send me to the SHAD Valley Program, where you basically take a bunch of classes and live on university campus with other keeners for a month. For a while, I couldn’t understand why she would pay so much for me to go other than to “build a network.” I now understand that she knew the value of teaching me to invest in myself at an early age.
Coaches/Therapists
Another thing I noticed was the plethora of career and personal coaches available. I really realized the value of coaches in being a levelled-up form of mentorship when I read Natasha Adamo’s blog on relationships; it was so powerful that I scheduled a free 15-minute phone consultation with her because I wanted to learn from her directly.
After realizing how much her coaching would cost, I set out to start a personal development fund. I’m now gradually saving up for personal and professional development coaches while keeping an eye out for key names to remember.
I’m also currently calling up 7+ therapists to get a 15-minute vibe check. Through therapy, I want to discover my blindspots and work on healing any blockers that may be in my way.
While casual mentor-mentee relationships are great (and free), experts usually have a wealth of knowledge accumulated from working with people who have similar problems as yours. It’s like the difference between going to a med-sci student vs. a doctor for advice on your disease
Get Out There
Nothing beats actually applying the skills. For me, one of the skills I want to hone in on is public speaking. I think being a good speaker is important because it’ll not only help you in presentations to teams but also in any daily life conversation.
Recently, in order to keep the promise to myself that I’ll seek out more public speaking opportunities, I volunteered to present to my marketing class of 30+ people. This was a class activity, but I was eager to practice telling my story in an interesting way.
The result? It gave me more confidence to see out larger opportunities, such as attending meetups.com or potentially giving a TED talk in the future.
Ultimately, when I 4x myself, I can 10x my profits and impact every area of my life.
The question isn’t if you should invest or not, but what you should invest it.
When you take a chance on yourself and spend money (or time) to make yourself better, you thereby increase your earning potential as opposed to only taking a chance on external factors such as the stock market. After all, as the business adage goes, the more (calculated) risks you take, the more your potential for returns.
At the end of the day, you only have so many resources available, so what will you invest in? Where will you spend your time/money/energy and with who?