I woke up one morning feeling like supermom and I wanted to do something special for my daughter. So, I decided to make her some homemade waffles for her lunchbox. A delicacy she thoroughly enjoys. It had been some months since the last time I had made some home-made waffles, thanks to Mama Woolies who is a great bail out when I do not have the opportunity to make some myself. This brings me to lesson number 1, before you invest, you must make sure you are very clear of what your investment goal is. Be precise about what you want to achieve so that you are able to evaluate your success towards achieving that goal. For me, the goal was to make waffles.
My waffle maker came with a manual that also has a few recipes so since the day I bought it; I would always revert to those recipes. However, on this day, I could not find it so in the spate of the moment, I just decided to google an alternative recipe. I decided to make the classic waffles and after going through a few options, I made my selection. This simple decision highlights lesson number 2, you need to be sure what investment process you would like to embark on to achieve your goal. Are you going for a passive or an active management strategy or both?
The recipe I had selected suggested that I use butter, but I had margarine and didn’t think too much of the swap. So, I took out my ingredients and had them lined up like a professional chef then I got the waffle maker ready. I had a short period of time to get the waffles ready as I decided to make them in time for the school run as well, so every second was critical. With every investment, you must be certain of how much time you have. If you do not have much time, then you must choose investments that are safer in nature. If you have more time on your hands and do not worry about having access to the capital, then you can choose the riskier investment options. This is lesson number 3.
My daughter was very excited, and she kept coming to ask me every 3 minutes if the waffles were ready. Bless her soul. I decided to start the preparation right away and I had the mixture ready in a few minutes and ready for baking. The recipe I had settled on suggested that I should also use the butter to grease the waffle maker to avoid the mixture from sticking so I just decided to proceed with the margarine, thinking what could go wrong. My goodness! The simple swap resulted in a nightmare experience because the waffles stuck to the pan and I had difficulty taking them out of the waffle maker. This meant that with every waffle, it got stuck, and I had to spend about 5 to 10 minutes scrapping the waffle out to the waffle maker before washing it and then attempting to make the next waffle. It was an absolute disaster and in the end my daughter never got to take waffles to school and we had to pack an emergency ham sandwich instead. This unfortunate incident brings me to lesson 4 that demands that every investor has to be aware of the risks involved in their investment strategy and if those risks would be acceptable to them. Do you want capital preservation or growth? What will it cost you in terms of your capital and are there chances of loss and not meeting your goal? All these will help you to have a better investment experience and hopefully one that brings you better joy than my waffle making experience on this day.