Previous | Why Growth Stocks Hate Higher Interest Rates Next | Required Minimum Distributions in 2023
August 04, 2022 / The Merrill Anderson Company
Fear of Missing Out is not a sound investment philosophy

Fear of Missing Out is not a sound investment philosophy

The Securities and Exchange Commission has created Investor.gov, a useful resource for the investing public prepared in ordinary, nonlegal, and nontechnical language. The website includes financial tools and calculators, as well as articles of general interest for investors.Woman sitting at her computer with notifications surrounding her

 

The “Director’s Take” is a collection of such articles by Lori Schock, Director of the SEC’s Office of Investor Education and Advocacy. One recent rumination is “Say No Go to FOMO.”  FOMO is the Fear of Missing Out, which has been the driver of certain crazes. We’ve witnessed an increase in investing fads recently.

 

These include cryptocurrencies, meme stocks (propelled by social media), and non-fungible tokens. The SEC isn’t about to forbid investing in these sorts of things, but they are warning against getting caught up in the emotions of investing in them, in surrendering to the fear of missing out on the next big thing. “You may see your favorite athlete, entertainer or social media influencer promoting these kinds of investment opportunities. Although it’s tempting, never make a decision to invest based solely on their recommendation.”

 

But there are three things that everyone should not miss out on, according to Ms. Schock:

 

  • Paying off credit cards, because the interest rate on credit card debt is typically much higher than the return on most investments.

  • Saving as much as possible as early as possible to take full advantage of the miracle of compound interest.

  • Grabbing free money by deferring enough in a company retirement plan, such as a 401(k) plan, to qualify for the maximum company match. If the employer has a 50% match, for example, that’s a guaranteed 50% return on investment in the first year – no ordinary investment is going to beat that.

© 2022 M.A. Co.  All rights reserved.

Recent Articles
Required Minimum Distributions in 2023
Required Minimum Distributions in 2023

Required Minimum Distributions in 2023

March 20, 2023 / The Merrill Anderson Company

First time home buyer assistance through First Front Door
First time home buyer assistance through First Front Door

First time home buyer assistance through First Front Door

March 17, 2023 / David Kuhns

How to avoid a phishing attack
How to avoid a phishing attack

How to avoid a phishing attack

March 14, 2023 / Ray Wills

Business owners can succeed with a personal touch
Business owners can succeed with a personal touch

Business owners can succeed with a personal touch

March 07, 2023 / Natasha Koons

Are you ready to be an entrepreneur?
Are you ready to be an entrepreneur?

Are you ready to be an entrepreneur?

February 24, 2023 / Patti Murray

Can inflation be contained and are higher interest rates here to stay?
Can inflation be contained and are higher interest rates here to stay?

Can inflation be contained and are higher interest rates here to stay?

February 16, 2023 / Warren Hurt

Investing Retirement Funds in Bitcoin Seen as Risky
Investing Retirement Funds in Bitcoin Seen as Risky

Investing Retirement Funds in Bitcoin Seen as Risky

February 10, 2023 / The Merrill Anderson Company

Annual Big Game Predictor 2023
Annual Big Game Predictor 2023

Annual Big Game Predictor 2023

February 07, 2023 / Warren Hurt

Mortgage tips for first time home buyers
Mortgage tips for first time home buyers

Mortgage tips for first time home buyers

January 25, 2023 / David Kuhns

Join our e-newsletter

Sign up for our e-newsletter to get new content each month.

NOTICE: YOU ARE LEAVING F&M TRUST!

You are now leaving the F&M Trust website. Links to third-party sites are provided for your convenience. Such sites are not within our control and may not follow the same privacy, security or accessibility standards as ours. F&M Trust neither endorses nor guarantees offerings of the third-party providers, nor is F&M Trust responsible for the security, content or availability of third-party sites, their partners or advertisers.