I think putting money in work so that your money could work and make you more money is the biggest difference.
Common man works himself and makes money with his work, investor puts his money to work and makes more money thanks to it, that means the more money you have the less you have to work, of course its not going to be instant but that is the roadmap.
You start off with whatever amount you have, you keep working on your regular job to keep making money but eventually you put aside lets say 50 bucks (the smallest I can think of) and then that makes you like maybe 1-2 dollars a year, then you save up more and put another 50 bucks and that makes you another 1-2 dollars a year too, as you can see its too small to realize or even care, as long as no emergency required you keep doing that for a long time and eventually you will have thousands of dollars in some investment that gives you enough to never work again.
Topic: Differences between an investor and common man! - page 15. (Read 3908 times)
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The main difference is the financial education and how a person works and handles money. Common man views money as a spending potential while an investor sees it as growth potential. If we talk about the majority, not everyone is like that
We see common people are not investing in anything because they use the money to buy what they need. But if they can think about their future, I am sure that they want to split the income that they get and then they can use it to buy the investment. Many people don't know about the real reason why the investor still invest their money in many things because they don't have much information about the investment and they still busy to search more money from another source.
A great investor chooses assets than liabilities. They will put considerations about the future returns. For example, an investor will buy a car to use in a business or buy an apartment to be rented. Know the risks of investments and decide wisely.
Meanwhile, a common man will choose liabilities instead. Taking loans, buy things that will not gonna benefit him in return. Know the risks but hastily decisions were made.
Meanwhile, a common man will choose liabilities instead. Taking loans, buy things that will not gonna benefit him in return. Know the risks but hastily decisions were made.
Many of the investors I met for the past several years have to take loan first before they start investing. Most of them lacked funds but determined to try their luck in business so they resorted to take a loan from the banks or from someone who can afford to loan them. Taking a loan to use in their investment are risky but many of their business are now profitable and they able to pay loan gradually. I think it is important to use a loan only when you are really sure on how to run the business that you planning to invest.
Likely I said,investors take loan only if they want to make more profitable investments but others take loans to buy things which becomes again liability to us.So we are getting more expenses by taking those loans.
For those that are taking loan not for the purpose of investment, do you think that they are really happy taking such loan? Nobody will be in his clear state of mind to just take loan to buy liability, but they have no choice than to do that because that is the only way that they can pay for those liabilities that are very necessary which their salary alone would not be able to solve. Likely I said,investors take loan only if they want to make more profitable investments but others take loans to buy things which becomes again liability to us.So we are getting more expenses by taking those loans.
For those that are taking loan not for the purpose of investment, do you think that they are really happy taking such loan? Nobody will be in his clear state of mind to just take loan to buy liability, but they have no choice than to do that because that is the only way that they can pay for those liabilities that are very necessary which their salary alone would not be able to solve. Everyone knows that loan is best to be taking when one needs to invest in it but what can they do, that is why we have minimal loan and heavy loan in my country, and that is also why financial institutions has also classifies loan to either to be business loan or a private loan, I believe that before they give loan too, they will ensure that the person will fall into the category of their loan.
The thing you said was right,it do really differs with peoples mindset on how they do make themselves profit in such possible ways.Investors mind will always look up for ways on accumulation and methods that would increase its holding even more not only on recent or current profiting but also they do target out for leverage too.
Emotion does plays a big factor with these investing field yet anytime it can mess out your entire plans.
Thanks, and you raise a great point as well. Equity management is a huge factor influencing profitability.
As important as controlling risk, it can be argued it's also vital to move in & capitalize your full resources when you see a strong opportunity,
including using leverage where a highly attractive reward to risk ratio would justify it...
then most probably they do have the edge compare to other man that do investing.Opportunity hunting will not be seen anytime if a certain investor doesn't know how to differentiate it.
Not all of them though.
There are a lot of people out there that is not even an investor but they know a lot of things they should do and not should do. To be honest, I don't even know what is the requirements or a classification of a person to achieve that kind of being an investor, can anyone explain that?
Totally agree with the bolded.
Whether one is spending or investing has to do with choice and does not require one to be a 'common man' or 'investor'.
If one choice to be poor in the years to come, its a simple choice by being lazy and spend recklessly and if they chose not to beg in the years to come, they work hard for it and learn to measure expenses. They don't go about terming themselves anything; it's all about how they live their lifestyle.
The main difference is the financial education and how a person works and handles money. Common man views money as a spending potential while an investor sees it as growth potential. If we talk about the majority, not everyone is like that
The common man splurges too much and doesn't think long term. The investor tries to make financial decisions based on increasing his money over the future.
Not all of them though.
There are a lot of people out there that is not even an investor but they know a lot of things they should do and not should do. To be honest, I don't even know what is the requirements or a classification of a person to achieve that kind of being an investor, can anyone explain that?
The common man sacrifices the future for the moment.
The investor sacrifices the moment for the future
The investor sacrifices the moment for the future
Only if it were so simple. Indeed, a loan taker sacrifices the future for the moment, but not all investments are successful ones in the long-term. You can think that you are sacrificing the moment for the future while, in reality, you can be just throwing your money away.
However, I absolutely agree with the OP regarding taking loans for buying things (which you, probably don't need, btw) right now and paying huge interests to the banks in the future. Think twice before doing that, because it can be the road to modern slavery.
Most likely investors knows the risk involved and learn how to mitigate it, while casuals joes will put their money and invest without knowing the risk and then complain when they have lost so much money. The difference is education as a smart investors knows when to quit and doesn't gamble but then chase the next big investment platform, get out, rinse and repeat.
Average investors on the other hand, still thinks that he can get out with a profit, prefer to stay on an investment when obviously it is not doing good and hope that it can recover soon. But we all know that once your investment plummet, it's better to take the lost and move on.
Average investors on the other hand, still thinks that he can get out with a profit, prefer to stay on an investment when obviously it is not doing good and hope that it can recover soon. But we all know that once your investment plummet, it's better to take the lost and move on.
What are the things differ from mindset of common man with investor,please share your thoughts.
IMO,investors never want to take loans for their consumption like home loan,car loan,etc then just save money and will buy the things for their needs but common man like you and me will buy the things immediately when we get the desire of it using loans but we are paying 20% of interest to those kind of loans.
You're wrong because there are many investors that also take loans for investment and other purposes. Actually in my knowledge and understanding common man that you have said and the investors are the same in some things like investing,buying and purchasing of some materials. The difference between this two are investors mostly focus on how to get money or to have a huge investment but the common man are those people that are satisfied of what they have and mostly investing are not their priority in life. IMO,investors never want to take loans for their consumption like home loan,car loan,etc then just save money and will buy the things for their needs but common man like you and me will buy the things immediately when we get the desire of it using loans but we are paying 20% of interest to those kind of loans.
IMO,investors never want to take loans for their consumption like home loan,car loan,etc then just save money and will buy the things for their needs but common man like you and me will buy the things immediately when we get the desire of it using loans but we are paying 20% of interest to those kind of loans.
Not exactly. An investor knows how to leverage debt. If they know they can earn much more from what they are using the debt on, they'd take it. The "common" people get in debt for things that don't put money in their wallet.
It's like buying a $300 worth of tablet and software and using that to create art for sale versus buying $300 worth of the latest fashion items. One earns you money the other doesn't.
I fall for the common man I guess, I immediately get what I want and it is because I loaned it, I don't have the patience of waiting and saving money for what I want. Sometimes I get the help from others including my family, (Dad and Mom), they are supportive and gives me the money whenever it is worth spending for, like in business. The nice thing is they don't charge me with interest, good deal right?
This is common with many people but do you know what a wise person would really do in your position, he would have all those money that you use in buying those things because they would only be a liability to you and not an asset, I am not saying that liability is also not okay to buy sometimes, but that would be when you already have an establishment and you have investment that will always bring the money for you to continue to maintain and service those liabilities.One thing I use to tell my younger ones is that there is always a time for everything, it is better that you suffer now and enjoy at your late time than to enjoy now and then suffer at late time, and one of the way to suffer now is to sacrifice some of those things for investment.
The common man splurges too much and doesn't think long term. The investor tries to make financial decisions based on increasing his money over the future.
I fall for the common man I guess, I immediately get what I want and it is because I loaned it, I don't have the patience of waiting and saving money for what I want. Sometimes I get the help from others including my family, (Dad and Mom), they are supportive and gives me the money whenever it is worth spending for, like in business. The nice thing is they don't charge me with interest, good deal right?
I think the main difference is the fact that the investor is not happy with how much money he has and the common man is. Right now the biggest mindset is that we all know the fact that in this life if you do not have enough money you are just another statistical living thing and you have absolutely no difference in human history then a pet dying, maybe some people mourn you after you die (though people mourn pets too) but in the end 200 years later nobody will even know you existed, how many people remember their great great grandfather right now?
Almost close to zero unless he was a known person. That is why if you want to make a name for yourself you have to be rich, you have to be powerful and that power comes from money most of the time. Hence we are not happy with what we have and we want more.
Almost close to zero unless he was a known person. That is why if you want to make a name for yourself you have to be rich, you have to be powerful and that power comes from money most of the time. Hence we are not happy with what we have and we want more.
What are the things differ from mindset of common man with investor,please share your thoughts.
I hope you are misunderstanding huge institutional investment firm since the normal investors are common people with who are salaried, i cannot imagine a world where only institutional investors will invest in anything and if that is the case the stock market wont be that high, the so called common man if educated enough will find opportunities to multiply his savings in safe harbor and that is where mutual funds and stock market and now the cryto market comes into place and the common man invest according to his skill level and understanding of the market or will hire someone to take care of his portfolio.
A true investor IMO has these characteristics:
•Optimistic no matter what happen to the market
•Always think for his future
•Will risk what he can afford to lose for something that he thinks has a potential
•Doesn't stop learning in growing his asset
•Most likely thinks different from others
On the other hand, a common man IMO has these characteristics:
•Doing things for his needs and wants
•Somehow has a doubt for himself
•Somehow believes that you only live ones so just enjoy it
•Just go with the flow
•Optimistic no matter what happen to the market
•Always think for his future
•Will risk what he can afford to lose for something that he thinks has a potential
•Doesn't stop learning in growing his asset
•Most likely thinks different from others
On the other hand, a common man IMO has these characteristics:
•Doing things for his needs and wants
•Somehow has a doubt for himself
•Somehow believes that you only live ones so just enjoy it
•Just go with the flow
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