Adam Levy

I help people make better decisions with their money. Contributing writer for @themotleyfool. Opinions here are my own.

[Adam Levy @admlvy]

@shaneparrish This is an incredible mindest! If you view each problem as a chance to work on your problem solving and decision making skills, you'll become better at both and live a happier life.

[Adam Levy @admlvy]

@BrianFeroldi Does this mean you never sell a stock?

I let many of investments run as long as the valuation isn’t too out of hand, but I trim back anything that gets above 10% for too long.

[Adam Levy @admlvy]

@BrianFeroldi I started investing at the end of 2008 early 2009. 11 years where the market basically only went up.

Then 2020 happened.

I relied on history and the wisdom of older investors in order not to panic. I was scared, but didn’t panic.

You’re right. No words for it.

[Adam Levy @admlvy]

@dollarsanddata Exhibit A appears to have buyer's remorse. They may have paid too much for a house with the hope of refinancing in the future. Not a good decision.

Exhibits B and C are just trying to close the door behind them, which isn't irrational but it is unbecoming.

[Adam Levy @admlvy]

@EngineeringFI_ There are often multiple "something else's" you choose not to do. By choosing one thing, you're implicitly saying it's worth more to you than any of those other things.

But opportunity cost is only as big as your incentive to make the most of those alternate opportunities.

[Adam Levy @admlvy]

@AffordAnything I’m inclined to believe you, but only because Richard Feynman was a physicist. But also, I failed out of physics, so I guess I’ll never understand human nature.

[Adam Levy @admlvy]

A great decision comes down to 2 things:

-taking in information
-filtering what matters

A chess grandmaster can see the whole board, filters hundred of options, and chooses the one that puts them in the best position.

[Adam Levy @admlvy]

@BrianFeroldi Yes. I always plan on changing my plan.

The plan might be to buy and hold forever. But if things change, I need to be able to change the plan.

[Adam Levy @admlvy]

Always make sure you’re working toward the RIGHT goal.

[Adam Levy @admlvy]

@MnkeDaniel It’s like a chess master. They’re able to quickly narrow a decision from hundreds of options to 2 or 3 choices and take the one they’re most familiar with.

[Adam Levy @admlvy]

@AffordAnything I used to think time was our most valuable asset.

Now I think it's attention.

They're closely linked, but they're not the same.

[Adam Levy @admlvy]

@BrianFeroldi An emergency fund is like insurance.

If things hit the fan and you're not covered, you'll pay dearly.

BUT, you only need so much of it before it becomes inefficient. And at some point, you might not need much at all.

[Adam Levy @admlvy]

A big reason money decisions are so hard:

It has nothing to do with where the stock market will be in 10 years.

It has everything to do with where you imagine you'll be in 10 years.

You may be better at the first than the second.

Are you who you thought you'd be 10 years ago?

[Adam Levy @admlvy]

@dollarsanddata Experience may be one of the most undervalued assets in the world.

[Adam Levy @admlvy]

@paulg If only I could go back in time to when I was 14 and tell myself this ... wait a second.

[Adam Levy @admlvy]

@shaneparrish Taking the time to identify those points of leverage is the hard work.

[Adam Levy @admlvy]

@awealthofcs Prediction is very hard, especially about the future.

[Adam Levy @admlvy]

@EngineeringFI_ It's hard to stop doing the things that got you to the financial position you're in today.

That's why frugal decamillionaires have trouble spending their retirement savings. Or how risk-taking overnight millionaires go broke tomorrow.

Reassessing life is a superpower.

[Adam Levy @admlvy]

Don't fear risk. Respect it.

If every financial decision you make works out, you're not taking enough risk.

If you're one bad result from getting wiped out, you're taking too much risk.

Life rewards those who take risks (appropriately).

[Adam Levy @admlvy]

@BrianFeroldi One of the biggest forces stopping people from making an investment decision (or any decision) is fear.

Some fear is normal.

The question to ask is, "If I knew more, would I be less afraid?"

Credit to a recent @ProfEmilyOster newsletter.