By Ntende John
This question is like a farmer wondering whether they should plant or not. Planting is the natural inclination of all farmers. Without planting there is no harvesting. Same thing with wealth. You can’t become rich without investing.
The real question is not whether you should invest, but when, where, and how you should invest. The wise farmer knows the seasons and the nature of his lands. He chooses the right crop for the right season. He may plant maize in one season and change to beans the next. He studies the markets to understand what is in demand and then goes ahead to learn all about that crop. If pineapples are in hot demand he plants pineapples the following season.
The wise farmer doesn’t grow only one crop. He changes crops from season to season and in some seasons he plants different crops on different plots. This way he reduces the risk of poor harvests or bad market conditions for his produce.
A prudent investor would do well to learn from the wise farmer. The aspiring investor should adopt the lifestyle of the planting farmer. He should never allow his money to sit idle in a bank account. The wise investor should learn all there is to learn of the various investing opportunities around him. He should try different projects to see what works best for him. He should allocate his resources to different assets in different seasons. When he is younger he should focus on more risky assets like businesses, real estate, and stocks. As he approaches retirement he should move to more liquid assets like treasury bonds and money market funds to provide an income. He should study the markets to identify opportunities which he can profit from.
Our wise investor should not fear taking on reasonable risk. Risk is part and parcel of planting and investing. The wise farmer expects his crop to fail but nonetheless proceeds to plant. He then does whatever it takes to reduce the risk of crop failure. He uses good quality seeds, removes the weeds, sprays, and installs an irrigation system.
So to answer the question – should we invest or not? Yes, we should because that is what we were created to do. Through investing, we create more wealth for ourselves and other people. We start new businesses, employ people, provide more goods and services to fellow human beings, provide funding to governments, and bring more life to everyone.
