What is subject to death dies, and I am not exempt – The Buddha
We are all born to die with no exceptions.
Many view this statement as morbid and depressing, but at a closer look, it’s liberating.
Death clarifies and prioritizes life.
People tend to distract themselves so they won’t have time to face the cold, hard truth of our limited time on this planet.
We find distractions in all the wrong places. Fancy cars, monstrous homes, or millions of Instagram followers do nothing to ease our biggest concern—our fleeting morality.
India’s most affluent family, the Ambanis, threw a wedding for their son Anant that cost over $600 million and had 2,000+ guests, including performances by Rihanna, Andrea Bocelli, Katy Perry, and The Backstreet Boys. The event took place over 3 days in Mumbai, and the Zuckerbergs, Kardashians, and Beckhams, along with a who’s who of politicians, attended.
Despite all this fanfare, the bride, groom, and all the distinguished guests will end up in the same place as the poorest resident of the notorious slums of Calcutta.
Death is always the undisputed champion of fate.
Like most challenges, the optimal strategy is to face reality head-on instead of hiding from it behind glitz and glamour.
The first step is not viewing life as a rehearsal. This world-view forces one to give full attention to all tasks, no matter how mundane. Everything deserves your complete absorption since this moment will never recur; it’s all there is.
Living in the past or future provides no relief from our mortality.
Think about the multitude of experiences you’ve had. How many of them have provided permanent residue and changed your life?
Will future experiences provide lasting joy, or are they just fleeting moments that you should maximize as they occur?
The stock market is another place to avoid putting your head in the sand and instead face the inevitable mayhem that provides the foundation for long-term success.
Long-term investors will experience multiple bear markets during their lifetime. Despite the false marketing of legions of financial snake-oil salespeople, there are no distractions or hedges to prevent this.
This chart from my colleague Ben Carlson should be stored safely and never forgotten during turbulent times.
The longer your time horizon, the higher your odds of losing 20% or more of your money in the stock market.
The market has seen a bear market over 5-year windows nearly 80% of the time. It’s also seen positive returns roughly 80% of the time over 5 years.
You have both a good chance of profits and a painful downturn. This is a feature, not a bug, when investing in stocks. Staying invested almost assures you’ll lose lots of money at some point.
This is the dichotomy of successful long-term investing.
While these facts are unpleasant, facing market realities is a far superior choice to thinking you will be immune to the inevitable.
Life exists in the present, not in the long-gone past or non-existent future.
The same philosophy applies to your portfolio. It’s impossible to change reality.
Adapting to and facing the truth is a superior investing strategy to delusion.
