Keri and I were out at the Farmer’s Market this past summer, and our favourite carrot vendor had an overabundance of those sweet, delicious garden carrots, so we loaded up.
On the other hand, a greenhouse malfunction had taken out a large crop of tomatoes, so the price was higher due to the short supply. Unsurprisingly, we took a pass.
It got me thinking: anytime something we need is on sale, we buy, almost without a second thought. In fact, we get downright excited to buy! (We even buy things we don’t need, which in hindsight we often regret!). And when prices jump, we will hold off and wait until they drop again.
But the funny thing we’ve noticed in our business is that nobody is excited to invest when markets are on sale! And everyone wants to load up when prices are high!
I know, it seems crazy, but for some reason we don’t apply our own shopping principles to our savings.
So what’s the solution?
We think it’s pretty straightforward: you need to have a plan. Your plan should tell you when to buy, how much to buy, and how often. And it should tell you when to sell, how much to sell, and how often.
It sounds simple, but it isn’t.
Stuart Sutton, B.COMM., CFP
Certified Financial Planner