I like investing. I haven't done enough of it, but I get a little thrill when I buy stock. It kind of reminds me a bit of playing poker. Each day is like a new hand. Your chip stack gets higher, or your chip stack gets lower, but it's not the hands that matter, but your overall stack. The trick is knowing when to walk away from the table.

It's a bit crazy to me that I can have a daily swing that is more than I used to make in a month. What is even crazier is this doesn't generally get me going either way. Sure, I prefer when the stock goes up, but since I don't plan to sell any time soon, it doesn't really matter to me too much. But when it goes down I don't get too upset. I have confidence it'll go back up in the long run. I don't mind fluctuations as long as the trend is in the right direction. I change my emotional response to market corrections and just tell myself this is when stock is "on sale." If you're wanting to get in, these are the moments you are looking for. Buying high and hoping for higher isn't a bad strategy. Expecting to get in on hot IPOs or to pick the next Tesla probably isn't going to pay off. Remember, there was a time when Yahoo was golden and Netscape was a rocket to the moon.

Buy low, sell high is the usual nugget of wisdom when buying stock, but the problem is identifying the lows and the highs. I can't help you there. I know what I look for, but mostly it comes down to these rules:

  1. Do I like the company?
  2. Do I understand what they do?
  3. Do I understand how they make their money?
  4. Do I like how they make their money?
  5. Do I think this company will be worth more in five years than it is now?
  6. Do I think this company will be increasing profits and seeing growth over the next five years?
  7. Do they pay a dividend?

I can get a no to one of the above questions and still buy, but the more nos, the less likely it's going to happen.

Nothing I've written here should be construed as financial advice of any kind. I'm an idiot, and you shouldn't give any credence to anything I write. This said, if I were to give stock advice it would be to stay the hell away from individual stocks. Buy mutual funds or index funds only. They are safer and out-perform most individual stock pickers. It's hard to outperform the market. Some people do, most don't.

So why don't I invest in mutual/index funds? Well, I do. The lion's share of my investments are in funds. Then why invest in individual stocks at all? Because I like to. I like buying things. But rather than a new pair of shoes I don't need or the latest video gaming system I like to buy a part of the company instead. I get the same sense of achievement and satisfaction from buying 100 shares of something that I used to get from buying a new computer or a new outfit. I've gotten to a point where I pretty much have everything I want, so what else am I going to do with my money? My answer is investing. I'm far from being rich, but I would like to get there someday. I'm not poor either, but I have been poor, and I know given the choice between the two it's far better to have money than not.

I'm not some high roller investor. I max out my Roth IRA. I have a supplemental retirement account. I have my employer provided plan. And I have some AAPL (205 shares today!). I plan to put $3,000-$6,000 a year directly into the market. I'd put more in there if I had more to put in. I like to keep myself "poor." When I have my money tied up in the market I can't really spend it.

My goal isn't really to become rich. My goal is to be able to afford retirement. I'm not on track. I'm playing catch up and am trying to be fairly aggressive with my investing. I've done fairly well so far, but most retirement calculators have me working well after I expect to be dead.

Want to see if you are on track? Here you go: Retirement Calculator

The sad fact is most Americans spend more money on their monthly cable/internet bill than they do their retirement. I don't want to be a greeter in a Walmart when I retire. I've got nothing against them, I just don't want to be one.

So I'm going to keep up with my investments, and I am going to keep up living frugally, and I am going to hope it all pays off in the end.

If not, I still have a couple healthy kidneys. (I am bullish on kidney futures).

• Christopher


Monkey see, monkey do.