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Slow financing: what is unreasonable spending and investing

 

The philosophy of slowness helps us prioritize spending and make smart, planned investments over the medium to long term. We show you strategies for success.


As a plant needs time, patience and care to grow, so does our money. At the very least, this approach will be the best way for him to grow steadily and not lose himself as quickly as it happened. The Slow Finance Philosophy, based on the slow life, offers exactly this: save thoughtfully, without rushing, prioritizing investment in the medium to long term. When it comes to consumption, do it with full awareness of what, when and how we spend our money. We have already seen this with slow food (as opposed to fast food), slow travel (travel without rush) and, in recent years, slow fashion (slow fashion). Now the slow movement is coming to finance and investment.


Slow finance or how to keep up with our money

The coronavirus meant a mandatory stop, and in many cases it was an opportunity to live slower, with the benefits that it entails. Now “we value more the luck we have to enjoy things like a rooftop, hot water and electricity, food, and friends and family who support us, situations that we take for granted and rarely truly value. "Says Guillem Roig, a member of the Spanish Association of Financial Consultants and Planners (EFPA). Without stress or rush - according to the recommendations of slow movements - we can enjoy more and appreciate the little things; We can also stop and think about life, our priorities ... and - why not - about our finances.


Slow motion aims to live stress-free, find the time to produce something of high quality and enjoy the process, “enjoy the trip and not get hung up on reaching the goal quickly.” When it comes to saving, living a slow life means “being aware of your money,” says Roig. And the fact is that, of course, it is very difficult to understand what we are spending them on when life goes on so fast. For this reason, the ability to live without haste, especially in times of uncertainty, helps us prioritize our spending. “This ultimately allows us to save more and spend more wisely,” he says.


What are Slow Attachments?

In terms of investment, such a slow, leisurely lifestyle “encourages long-term thinking and gradual action,” says the expert. In other words, it prevents us from getting carried away with short-term dynamics that can lead to impulsive decisions that are "almost always harmful" in the long run.


This form of investing, which encourages action, is a recipe for investment success. For this reason, a slow lifestyle is the ideal philosophy for our money to grow steadily over time.


Advantages and Disadvantages for the Small Investor

Overall, this way of investing is a great advantage: it allows us to make more informed decisions. “Speed, greed and emotion usually don't help you manage your money well,” says Guillem Roig.


However, this type of finance and investment also has disadvantages:

❌ The main one is that “some people may be bored, this is reality,” admits the EFPA expert, who also explains that “working with money is boring and profitable in the long term”.


❌ It is also important to note that this is not a reliable recipe. This is why it is so important to get real and independent advice. This will help us multiply our money and increase the chances of achieving our vital goals.


Tips for Successful Slow Finance Practice

Renta4, a pioneer bank in this way of investing, details some of the guidelines you can follow to avoid making the mistake of slow investment:


✅ You should only contract for products and services that you understand.

✅ It is important to be patient and not rush to create wealth, but do it gradually.

✅ Always consider the investment in the medium or long term.

✅ You should get advice from experts.

✅ Stay true to your strategy and avoid decisions based on panic and euphoria.

✅ You should give yourself advice, but remember that the final decision is yours and you should feel comfortable with it.


Is now a good time to invest?

Pandemic, economic crisis ... This all sounds like bad news and many are wondering if the time has come to invest. Expert Guillem Roig relieves us of doubts: "The best time to invest was yesterday, and the second best time is now." In his opinion, this is always a good time to start investing if you have enough knowledge and choose the right products.


He also notes that numerous studies have shown that “an attemptpredicting the best time to start investing doesn't work, ”so it's best to start as soon as possible. Of course, it is important to understand well where we are investing money, and for the long term, without rushing.
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