It can feel discouraging to keep sacrificing as you wait for the miracle of compounding to work its magic and accumulate enough to buy a house, pay for college or fund your retirement nest egg. But ordinary people who have attained such goals — and more — are everywhere. Call them the successful investors next door. They succeed in a variety of ways, but all employ some key strategies for staying motivated and investing wisely.
If you’re saving for a specific goal (in other words, something more concrete than just a bigger portfolio), you’ve already taken a crucial step toward success, says Daniel Crosby, author of several books on behavioral finance, including the forth- coming The Soul of Wealth. Research shows that “investors who tie their financial lives to a why — to a purpose other than just investment performance — save more and are dramatically less likely to sell in bear markets,” he says. “They report greater life satisfaction. They have more fun.”
