I came across a quote on the internet that read, "99% of the battle is getting your mind right" and I think is particularly true with investments and money. However, you must not conflate a lack of skill problem with a bad psychology problem. This is something that many people fall for and they take the path of self-help books and seminars - The Anthony Robbins and Gary Vees. Coming back to topic, whatever sub category of sub-psychological problem you may have, it will always lead back to either of the two; greed or fear.

Greed and fear can come out in tricky ways that you may not be able to recognize. Most people only see through their own greed and fear when they are in their old ages, late 50s perhaps if you are lucky.

Now, being greedy or fearful is not the real problem because these are natural human emotions and even after your best try, you can only tame them but not be rid of them. There are 2 ways to go about this challenge and self-honesty is an important ingredient. One is more mathematical and the other is a little more philosophical.

The Math: Take a look at your finances and then list down your goals (in financial terms). If your goals are insanely ambitious, you have a very short timeline (with unfavorable external circumstances) and lack of skill to achieve the same, you my friend are most likely to be greedy. However, take this with a pinch of salt because if the external circumstances are such that it is easy to make fast money e.g. the crypto boom in 2017-18, then you must by all means grab the opportunity but at the same time be aware that you are not a genius. No gold miner would claim that he struck gold mainly because of his skill(even though many do); understand the role of luck. Stay humble.

On the other side, if you are someone who is sitting on a pile of cash, have steady cashflows and keeping your cash in a bank FD, you my friend are quite fearful or just ignorantly satisfied which makes you quite in efficient. You need to skill up and learn how to safely invest your surplus money better. *The difference between greed and ambition is that, in the first case one has no real skills, no proper understanding and on an extremely short timeline, mostly on the lookout for shortcuts to make big money fast. And in the case of the latter, one has big clear goals which are long-term in nature, realistic and has the understanding and courage to admit that there is a chance of failure along the way.

The Art/Philosophy:

Practicing self-awareness which involves ruthless self-honesty is the other solution to over coming the challenge of psychology. This is not an easy challenge but you can definitely overcome the same with focus, age and maturity.

Finally, let me reiterate that all of the above does not apply to you if you do not have the necessary skills to succeed in finance and investments. The next post talks about the skills in more details.