TELL ME ABOUT YOUR BACKGROUND
I am originally from Malaysia but now reside in Australia.
I received my engineering degree from the University of Queenland.
I quit my job as a project engineer after 5 years to learn trading and investing.
My passion for teaching and entrepreneurship drove me to establish Stewardship Finance Academy, with the goal of instilling financial confidence in people’s lives.
What are the three main things people need to take note of when it comes to their finances and investing?
1. Invest As Early As You Can
Over 90% of successful investors start investing early. Many people underestimate the value of time in investment. It is essential for the compounding to work.
For example, if a person at the age of 20 invests $10,000 with no additional contributions, his investment will be worth $149,744.58 when he is 40, assuming a 7% annual return.
If he begins investing at the age of 21, the return drops to $139,948.20, a difference of $9,796.38 (-6.54%).
A 5-year delay reduces the investment return to $106,765.81, a difference of $42,978.77 (-28.7%).
2. Focus On Application
We live in the digital age, where information can be obtained for free and quickly. However, we must not deceive ourselves and stop at the stage of gathering information. Learning does not produce results; rather, application does. We must put what we have learned into practise. If it costs you everything, hire someone to help you understand the information and guide you as you apply it.
3. Take Action Now!
The worst excuse is a good excuse
Crypto and bitcoin are becoming popular trading activities. What are your thoughts on these as investment strategies?
If you want to trade cryptocurrencies for short-term profit, I recommend that you learn technical analysis, conduct fundamental research, understand how cryptocurrencies work, control your emotions, and practise risk and money management.
If you want to invest in cryptocurrencies and keep them for a long time, treat them as assets.
I will invest no more than 5% of my total portfolio allocation.
Diversifying our investments is always a good idea.
Cryptocurrencies, in my opinion, serve as insurance, a potential hedge against the current fragile monetary system.
What common mistakes do people make when it comes to their finances?
In our course How To Improve Investing Mindset in 2 Hours, we reveal the 12 most common mistakes people make when it comes to investing.
These errors arise from the bad habits, resulting in investment losses.
Following the herd mentality, looking for a hot tip, and ignoring the risk are just a few examples.
The global economy is not necessarily stable. What is the best approach people should take regarding their finances when they hear these reports?
Despite the fact that global economic news is fraught with uncertainty, I do not advocate ignoring it entirely.
Putting our heads in the sand will not save us from doomsday.
Throughout history, no wealth has ever left the planet, even during recessions or the Great Depression.
Money is simply transferred. Wealth is simply moved from one place to another.
The reason we should pay attention to macroeconomics is to detect the flow of wealth and position our finances to benefit from it.
That is why some people believe that in the midst of every crisis, lies great opportunity.
What are the biggest misconceptions about money/finances and investing?
Underestimate the impact of inflation to your money and the power of compounding to your investment.
What lessons have you learned from your mentor, John Yii, that you can share with us
The five most important lessons I’ve learned from my mentor:
1.Take responsibility
Being held accountable prevents me from procrastinating.
2.Learning from one’s mistakes
Learning from my mentor’s mistakes keeps me from making the same ones. This is priceless because it would have cost me money and wasted a lot of time.
3.Inspiration
The trading and investing journey is fraught with ups and downs. When I falter, my mentor encourages me to stay the course.
4.Consult with others before acting
Before taking action, talk to the other students in the group to increase my chances of success.
5.Receptive to feedback
My mentor frequently provides me with direct, constructive feedback. He had high expectations of me.
James Lim
SFA Founder
Member of Australian Investors Association (AIA)
The University of Queensland Speaker
