What squirrels can teach us about investing

Here’s a little exercise that might be beneficial to your stress level and might even help you with your investments.

Harvesting Dividends?  

No matter where you live in America, there is probably a squirrel in your yard every day.   Just for fun, take an opportunity to watch the squirrels today.  Maybe take that morning cup of tea or coffee into the yard and sit quietly watching the squirrels at work and play.  Watch them as they stand in line at the little squirrel coffee shop discussing the acorn futures market.  As they read the Squirrel Daily’s Business section looking for an update on the upcoming acorn tax legislation.  Panicking as they hear that there may be an oversupply of acorns driving the price down or a shortage due to climate change.  Many squirrels distrust the reporting of other squirrels, so you may notice some watching Fox News, sorry, couldn’t resist.  If you actually see squirrels doing this in your backyard today, film it and your money worries will be over.  But you won’t see squirrels doing anything like this.

So go back to the coffee, take a deep breath, let it out nice and slowly, and watch what squirrels really do all day. You may see them stop and enjoy an acorn or you may see them collecting acorns and running off to hide them.  They may have a little fun chasing each other or running off a few birds from your bird feeder.  If you think about it, squirrels are the ideal long-term investors.  Every day they work on their portfolio, harvesting dividends(acorns) that have fallen from their investment portfolio (trees).  Some of the dividends are used immediately.  They sit back, like the squirrel above, and enjoy a little of their tree’s income for immediate consumption.  You may see them reinvesting the dividends by putting them in a little hole where, if not found during the winter, they will ultimately become another income producing investment in the form of another tree.  Squirrels never develop investiphobia.  Following their instincts, they invest wisely and enjoy the fruits of their labor and their investments.  We should be more like squirrels.

So, hop up and chase your neighbor up a tree.  Or, get to work and focus on work.  When you play, enjoy yourself immensely.  Life should be fun.  Do this daily and you may find that your portfolio does fine, even when you don’t watch it every day, hour, minute!  I’m back to work, but tonight I’m watching squirrels.

Money is not your life.  It is simply the means to the life that you want.

Paul

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3 Responses to “What squirrels can teach us about investing”

  1. Senan Says:

    Enjoyed the post. I wish I had your ability to relax and watch squirrels all day. I agree with the idea of squirreling away dividends.

  2. jinomi Says:

    Thanks for this post! I’m taking a science class where we have to observe nature, draw one thing that we have taken care to observe in detail, and then ask questions about our observations.

    There are lots of squirrels where I live, and just the other day I was watching 4 or 5 as they stuffed their mouths with maple seeds, keeping an eye on me the whole time. I will be sure to take more time enjoying them, and all natural wonders that have lessons to teach.

  3. Mike Says:

    Great post Paul. It really brings out the important things in life (work hard, play harder and enjoy life). All of that worrying and fussing and micromanaging of investments takes the joy out of life for a lot of people. You can have 5 million dollars to your net worth and if you die of a stress induced heart attack or stroke (or even get hit by a bus on the way home) you can’t take any of it with you, so stop worrying!

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