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Orange on Green: "Boring" is the "In Thing"

Orange on Green: "Boring" is the "In Thing"
Save your hot trend fixes for your wardrobe. But when it comes to your finances, traditional is the way to go. Find out why our financial columnists recommend against the latest money fads.


Everywhere you look, it seems like there are "'trends"' — fashion trends, education trends, financial trends.

 

The problem with trends is that they typically are not based on long-term values. Nowhere is this truer than in the financial world. It seems that every year, a "hot, new" savings, investment or tax strategy is introduced. While these new trends may have merit, they often are created to generate sales of financial products and not rooted in fundamental long-term strategies.

 

Why is this a problem? Unlike fashion trends, where your clothes can be given away or inexpensively replaced, financial trends that are improperly implemented can cause you long-lasting and even irreparable harm.

 

For example, in the 1980s, real estate tax shelters were very popular with investors until Congress passed the Tax Reform Act of 1986. Overnight, many properties became much less valuable, and investors heavy in real estate lost most of their net worth.

 

In the late 1990s, stocks of technology and dot-com companies were all the rage. Not only were investors going ga-ga over these stocks, many people left their careers to join start-up companies in the "brave, new world of technology." In the year 2000, the entire sector of technology stocks was nearly wiped out. Reality had set in when investors finally realized that companies actually need to make a profit to stay in business. Once again, investors heavy in technology stocks lost most of their net worth.

 

What have these trends taught us? That the best financial trend is NO trend. Your financial world should be built upon the bedrock of long-standing, time-tested financial principles. For long-term financial confidence and freedom, get educated about these bedrock ideas. Our research has shown time and again that the most financially successful individuals utilize the same financial principles:


1. They have protected their family, business and money from the unexpected.

2. They live within their means and save a portion of every check.

3. They diversify savings and investments so as not to be vulnerable to changes in investment and tax laws.

4. They understand the long-term implication of tax laws on their money.

 

We understand that these principles are not sexy or exciting. In fact, they're boring. When it comes to your money, however, boring can be good. Knowing that your family is protected, that you're building savings and your future offers financial freedom allows you to live life on your terms.

 

When it comes to trends, go ahead and buy the latest clothes. You deserve to look your best. However, when it comes to your money, avoid the financial trends. Stick with the basics, and create that confidence.

Tom And Brad Cunningham -

Tom and Brad Cunningham are Cincy Chic's financial columnists, and they are the co-founders of Orangefinancial. If you want to share your comments or inquire for more information, e-mail them at This e-mail address is being protected from spambots. You need JavaScript enabled to view it and This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

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