Every once in a while I read books on business and investing just to give me a solid foundation to build on should I decide to go into business for myself. One of my favorite books on investments is The Five Rules for Successful Stock Investing by Pat Dorsey and Morningstar because it gives thorough explanations and isn't a get rich quick type of investment strategy. As you can tell from the title the book lays out in the first chapter five rules that every successful investor should follow and while looking over them late last night I noticed that these rules could also be applicable to self-improvement and goal setting. Yes, it turns out that investing in stocks is much like investing in yourself and done right both can pay off handsomely, only self-improvement the results are a lot less volatile.

1. Do Your Homework

Obviously before starting any goal the most important thing to do is to research how you can accomplish it successfully. Right now one of my goals is to learn everything I can about writing a screenplay as a part of my larger goal of learning all I can about making movies. It would be easy for me to rush into this and just commit a bunch of words into a word processor with some semblance of a story and call it a screenplay but that wouldn't be a good screenplay now would it? The time that you put into before setting off on your goals should allow you to have a plan of action and be more prepared for any setbacks that you will inevitably face while seeking your goal.

2. Find Economic Moats

In the book this section is referring to the competitive advantage firms have within their market but for our purposes we'll be using it to refer to your personal competition. Now not all goals will have you competing against other but some will. For instance, if your goal is to attain a certain position within a company or get into a certain school then you are going to have to separate yourself from the rest of the pack by being able to do something better than anyone else can. Even if we go beyond specific goals we can apply this rule to life in general, consistently growing and improving creates a moat that can protect you in tough times. Economic moats allow companies to be more profitable just as growth allows your life to be more profitable. If you read and engage your interests and develop new skills are you not better off in a terrible economic climate than someone who does nothing to better themselves? Of course you are because whether it's having a better resume for a job or taking the reins yourself you always know that you have value to offer. So create moats for yourself by learning new things and separate yourself from the competition. Becoming World Class at Something.


3. Have a Margin of Safety

In the book this section deals with valuation of stocks and making sure that the price you pay isn't too high. In life sometimes the price you pay for something may also be too much and leaves you high and dry when things don't work out. Just like stocks you can overvalue people too. If you are in a relationship with someone and it's not going the way you want it to then you may be paying too high of a price to be with that person. This extra cost can be physical, emotional, or just your partner holding you back from being the person you want to be. You have to be honest and evaluate the person realistically to see if they are the right match for you or just someone who was nice for awhile and has since declined in their personal value. If you come to the conclusion that the price you're paying to stay with them exceeds what you actually want then it is time to move on.

4.Hold for the Long Haul

In investments constantly trading racks up fees and taxes which will usually hurt long term growth. With goals if you constantly shift from one to the next without putting the proper amount of time into it you're also hurting yourself in the long term. Jumping around with your goals leaves your original goals done hastily or you never complete them at all. Sometimes moving on is required but often it is simply due to a lack of commitment on your part. I often had this problem when reading books. I would buy one long book and be absorbed in it for a few days and then I would hear about a topic that seemed interesting and buy a book on that. I eventually found myself with a ton of books but only a shallow understanding of each because I lacked the commitment to keep going with the book or subject. I finally decided to do something about this by selling those books I had started but weren't on a topic that I was interested in on a regular basis and then made myself get through the ones I did have a consistent interest in. Sticking with your goal allows you to reap all of the benefits that you originally set out to acquire while bowing out early is like a paying tax (time and energy invested) and not receiving much profit.

5. Know When to Sell

Ah so now we get to when it is appropriate to shift away from one goal to another. First ask yourself is it worth it to you to keep continuing your pursuit of the goal? If the answer is no then it is probably time to reevaluate things. Obviously if you have achieved what you set out to do then of course it is time to move on to something new. But if your goal was something like weight loss then you will need to maintain a healthy lifestyle otherwise the result of your goal was temporary. The book goes into asking whether your money could be invested better somewhere else and if you have too much money in one stock. This translates well to what we are trying to do with this article. Replace money with time. Could your time produce better results if it were spent another way? There are only 24 hours in a day and each of them must be scheduled accordingly and if one pursuit isn't paying you back it's fair share based on the amount of time invested then it may be time to let it go. Also, while focusing on one goal in the short term can be very beneficial, if you put all of your eggs in one basket it will hinder the rest of your growth if you dedicate too much time to it over the long haul. Eventually you will see diminishing returns in its value to your growth and can be disastrous if one thing goes wrong. If all your doing is pursuing one thing and that doesn't work out you're not left with much to cling to.

This is just a few short ideas that I was exploring based off of these rules and I believe that if you do some thinking on them of your own you can find a way to apply them to your life. Personally I like to look for advice and inspiration in lots of different ways so maybe I'll make a trip to the business section of the used book store and find other thought provoking ideas, after I finish my current reading list of course.

I have a lot of bookmarks that I have saved on Firefox and last night I was going through the list and deleting the ones I no longer needed. While cleaning up my bookmarks I noticed where I had saved information about a certain video camera and different lenses, stands, and microphones that could be attached to it. It gave me a sense of motivation not because I simply wanted the camera but it represented a goal that I have in mind which is to write my own screenplay and then film it as a low budget movie. This goal is preceded by my current goal of turning this site into a success and garnering enough traffic to earn a passive income and in fact rests on me doing so because I can’t very well have the freedom to film a movie working some crummy job everyday. This motivation I have been feeling for the past few months has been incredible and everyday something new inspires me again it’s like a perpetual kick in the ass that won’t let me give up. It’s a feeling of knowing that something is going to happen because you’re just so tuned into making it so that it is a foregone conclusion.

I remember for the past two years or so of my life sitting at work talking with my friend about how great it would be not to have a job and it always ended with the feeling that yes it would be great but it’s not realistic. It wasn’t until I sat down and made it my intention to find a way off the usual path that I really believed that it was possible for me not to work a crappy job and then graduate and get another job. My self belief has gotten to the point where I don’t even think about getting a job after I finish my degree because it’s not a part of who I am or who I want to become. Those fears of being forced into a life I don’t want have been replaced by goals both big and small, long term and short term. The change is in fact to stop thinking about what will happen to you and to rather think about how I am going to get where I want to go.

Once you open your mind up in this way things just start coming to you like ideas to write about or even new ways to make money. Last week while I was surfing the web a bit I was on a site and saw an ad for their ebook which was available for download. Now I’ve seen these ads probably thousands of times in all of the years I’ve been on the internet but it wasn’t until that instance that I thought about writing one myself. It never occurred to me that I could write and publish my own book online for a profit (and here I am publishing on the internet with this blog) perhaps I’m just stupid and overlooked an opportunity that was staring me right in the face or maybe it was the mindset I’ve developed for constantly looking for new opportunities. That one small image advertisement altered the course of work I plan on doing in the next few months and inspired me to begin planning my own ebook(s).

We human beings have a huge capacity for problem solving and when we’re motivated to do something you can better believe that a solution will be found. Too often our thoughts are attached to some responsibility or work instead of being free flowing and meditative which is usually where we come up with our most brilliant ideas that seem to be plucked from thin air. The desire that gives us our will to succeed brings forth all of these ideas and makes them easy to dream up, you start understanding more, connecting dots you didn’t know existed, and seeing angles that had previously escaped you. I don’t seem to ever worry about what to write anymore and now only focus on which idea I am going to develop for the blog today. Coming up with new ideas isn’t something I sit down and do, I just let them trickle in to my brain and then scribble down the idea however vague into my notebook. When I went to bed at around 3 AM this morning I had just finished listening to one of my audio books and wasn’t really focused on anything then this blog crossed my mind. Suddenly I had an idea and I got up out of bed to write it down. Then another one not more than 15 seconds after I had laid back down. This happened a total of four times before I finally fell asleep. As you can see, writer’s block should present much of a problem with inspiration like that.

So what is it that drives you in life? For me it seems to be having the freedom to create and express myself in a variety of ways. Think about what it is in your life that gives you that feeling of motivation like no other. Once you have that and start working towards getting there you will see the paths opening up even if it’s a roundabout way like mine. In order for me to manifest my desire to make a screenplay and film I chose to take this path of blogging to help raise the capital to finance my endeavors which still allows me to be creative and express myself. In a way I’m doing something that I enjoy to make a living to pursue something else I enjoy and I’m sure that will open up further opportunities for me. This drive should make you excited about waking up each day because at least half of the fun of setting a goal is the journey you take to get there and the knowledge that you will get there one day fuels your work ethic and creativity. Ponder your own life and find what it is that you want and the motivation will rise from there, mine all seems to be encapsulated on a single camera I don’t own (yet).

I've been thinking a lot today about failure and how much power we sometimes let it have in determining our lives. I always liked that Michael Jordan quote about being able to accept failure but not being able to accept not trying and the more I thought about it the more I realized that basketball was a perfect example of it in my life as well. A star perimeter player in the NBA will hit around 50% of his shots that means he will fail half of the time he tries to make a shot. You might say well those are small failures and you would be correct but all of those small failures add up to great success. Even though a basketball player spends hours of his life practicing shooting he knows that even though he will miss shots he must keep shooting because of the confidence he has developed over the years.

I look at my own experiences with basketball and see plenty of defeats and failures to execute but it never erased my love of the game for they were all only temporary set backs. I could have stopped playing at the age of six when my shots weren't falling the way I wanted them, I could have stopped playing when I was cut from teams, I could have stopped trying to dunk (haha I'm still working on this)but none of this ever made me quit or make me any less passionate.

We only seem to remember our major letdowns and forget all the little battles we lost at first like learning to tie our shoes or ride a bike because those have become habits that are ingrained in our minds. I think the key is to try and never let one failure effect you more than another no matter how much you worked towards that goal. Obviously some will push us to our psychological breaking point and that's fine you're going to get knocked down sometimes but are you going to let one thing keep beating you down repeatedly?

That's one of the great things about being human, our ability to learn and overcome what we once thought were our limits. How many times did people fail before the 4 minute mile 'barrier' was broken? Well, every documented runner up to that point. Failure is not meant to be a deterrent but rather a learning experience, something that you analyze and try to figure out with the same vigor as your first attempt. You're always going to make mistakes there just isn't any point in letting it depress you.

So take this to heart when you're trying to accomplish your current goals or goals that are still on the horizon: Every success is made up of smaller failures. Maybe you're are trying to lose weight and it isn't working as well as you had planned. Does that mean you should just stop and revert back to your old unhealthy lifestyle? No, it only means that you must adapt to a new exercise and/or diet plan to get six pack abs. To get to where you want to go in life involves accepting that you will always experience more failure than you do moments of triumph.