Summer is in full swing and that means lots of fun, hanging out with friends, going to the beach, hosting barbecues, and getting out of town for long weekends. And don’t forget about summer love. This is the time to take advantage of the carefree summer atmosphere and enjoy summer flings. Summer flings require little commitment and the ability to “test the waters” before starting a real relationship.
What do summer flings and long-term relationships have to do with investing? We’re glad you asked. Here are the top three things that these relationships can teach you about investing.
1. Summer flings are fun and (usually) nothing more
Summer flings are usually pretty casual and don’t lead to anything serious or substantial in your life. When starting your fling, you probably know that but decide to go for it anyway.
In finance, we call this speculating. Speculating is when you invest knowing that there is a high chance of failure. However, high-risk investment can also result in significant gains and incredible success (the probability is low but it’s possible). Speculation is more common in certain fields than others. For example, mutual and hedge fund investments may be considered speculation, along with some real estate deals.
2. Long-term relationships are serious and often worthwhile in the long run
Anyone who has been in a long-term relationship knows that they can be amazing but require hard work and effort. All of this work is worth it for a partner that you may spend the rest of your life with. You continue to slowly build the relationship because of its potential and the opportunity for growth.
In finance, we call this investing. When you invest, your goal is still to make money but good investments don’t involve a large level of risk and are long-term – at least one year. To invest successfully, you have to analyze your options and do the proper research (we make this easy for you with our investment platform). In the end, the results are often worth the effort and patience, just like your long-term relationship.
3. Each summer fling helps you prepare better for your next relationship
If you have a summer fling that remains a fling, you’re probably not too upset. After all, you knew that was likely. And every relationship, no matter how long or short, teaches you important lessons for the next time around.
This is also true in finance. When designing your portfolio, you’ll take into account the risk factor, length of investment, and more. Every Cherries portfolio is assigned a risk level and it’s up to you to decide how much you can handle. If you’re not happy with the results, at least you’ll know better for next time.
Relationships and Investing – Take Away Lessons
Whether you’re talking about finances or romance, sometimes you’re ready to take a risk and other times you want something that is a bit more secure.
Either way, it’s important to go into both financial and romantic decisions with your eyes open so that you don’t get surprised by the results. For now, continue enjoying your summer. It may not last forever so make the most of it!