7 Lifestyle Habits to Make You a Better Investor

lifestyle habits - 7 Lifestyle Habits to Make You a Better Investor

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There are lots of conventional ways to become a better investor. You can diversify your portfolio, educate yourself, and gain more experience through trial and error. But you might be surprised to learn that there are some lifestyle habits that can make you a better investor as well.

These are changes to your habits, behaviors, routines, and even your outlook, ranging from subtle to significant, that can equip you with better decision-making abilities and ultimately help you succeed as an investor.

So what are these lifestyle habits?

1. Mindfulness meditation

Mindfulness meditation is a simple yet powerful habit, and it only takes a few minutes a day to practice. The idea is to block out distractions and clear your head, allowing your thoughts and feelings to occur but consciously recognizing them at a distance, as if witnessing clouds pass above you.

This state is shown to reduce stress, which of course is good. But more importantly, it’s proven to improve your ability to regulate emotions. The best investment decisions are rooted in objective, logical reasoning, rather than emotional whims, so this can be a powerful tool for more rational decision making.

2. Better sleep habits

Stress and sleep have a mutually detrimental relationship, with stress causing more sleep problems and sleep deficiency causing more stress. At some point in this cycle, you’ll experience deteriorating cognitive abilities, with weaker memory formation and poor judgment — all of which can affect your investment outcomes. Getting better, more consistent sleep can help you fight back against these conditions.

3. Deep breathing

Deep breathing, while simple, is also effective in two primary ways. First, deep breathing reduces stress, making you mentally healthier and more relaxed. Second, deep breathing in the middle of an investment decision can help delay your response, so you think more fully and rationally about your actions.

4. Healthy eating

If you want to make good decisions, your brain needs fuel. Your brain gets fuel from glucose, which circulates in your bloodstream. If your blood sugar gets too low or too high, you’ll be less able to make intelligent decisions.

The solution is to eat foods capable of sustaining you with a constant, moderate level of blood sugar. These are foods high in complex carbohydrates, fats and proteins, such as vegetables, oatmeal, whole grains, lean meats and nuts. You can also graze throughout the day to keep your blood sugar levels consistent.

5. Regular introspection and self-assessment

How often do you pause and look inwardly at your ability to make decisions and make progress in your daily life? Introspection takes only a few minutes out of your day but can lead you to some startling revelations about yourself.

Did you make that trade because you think it’s going to succeed or because you trust the author of the article you just read? Are you overly aggressive in your tactics because you’re angry about something that happened last night? The more you know about yourself, the better.

6. Decision fatigue reduction

Decision fatigue is a real phenomenon. You can think of your decision-making abilities as a kind of muscle — one that can tire out. In short, the more decisions you make, the harder it becomes to make decisions.

One way to overcome this seemingly burdensome system is to reduce the number of decisions you make in a day. You can do this by making decisions in advance, delegating decisions to others, or picking things at random when they don’t have much impact on your life (like what to order at lunch).

7. Bias recognition

Finally, take the time to learn about the biases that affect the human mind. These are things like confirmation bias, which makes you disproportionately value information that agrees with your preconceived notions, and the gambler’s fallacy, which makes you irrationally believe a payoff is “due” after experiencing losses.

Learning these biases makes you better able to recognize them as they appear throughout your life, especially when they may be influencing your investment choices.

Can You Get Rich From These Habits?

If you’re an experienced investor, you already know that these habits alone won’t be enough to guarantee you a better return on your investments. Instead, these habits are meant to serve as complements to your existing investment strategies.

You’ll need to equip yourself with the right education, experience and tools to invest intelligently if you want to be successful; these everyday tactics and habit changes are just icing on the cake.

Article printed from InvestorPlace Media, https://investorplace.com/2017/09/7-lifestyle-habits-to-make-you-a-better-investor/.

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