3 Spiritual Laws To Apply To Your Personal Finances

It’s a well-known fact by now that behavioural cues play a critical role in one’s long term investing success. In fact, there are studies corroborating the fact that a discernible ‘behaviour gap’ exists between real returns and published returns for any investment product! And since we also know that putting certain time-tested spiritual laws into practice in your own life can prove to be a supremely effective behaviour regulation tool, it follows that adhering to certain spiritual tenets can also lead to success with our investments. Here are three of them.

Be in the present moment
Gurus, Zen masters and motivational speakers alike widely tout the benefits of ‘being in the present moment’. In fact, this practice can go a long way in helping you become a better investor. By dwelling on our past mistakes or poor decisions, investors often succumb to a wide range of biases – two of them being loss aversion and conformation. Stung by losses in the past, investors often shy away from higher risk products altogether – thereby subjecting their long-term investments to poor returns. Also, an investor’s prior experience wit a particular asset class (be it positive or negative) may very well lead him to maintain a rigid point of view about that asset class (good or bad) even in the face of steadily mounting evidence to support a contrarian viewpoint. Be in the moment, let go of the past, and see facts for what they really are.

Let go of negative emotions
Your negative emotions can serve as a powerful barrier to your investing success. By employing techniques such as meditation, introspection and prayer, many people have successfully chipped away at such negative emotions and conquered them over time. Emotions such as greed and fear can be direct influencers of your investment related actions, either by holding you back from making investments, or making you rush headlong into already-risen asset classes. Additionally, jealousy can potentially make you over-leverage yourself and save less for your sacrosanct goals in the process, as you may wind up being overtly engrossed in ‘keeping up with the Jones’s’. Financial decisions are best taken with a calm, rational mind – free of anxiety or panic, and by employing the good sense endowed upon you by the universe. Which is why letting go of destructive emotions can make you an exponentially better investor.

Believe in a power higher than yourself
Pause for a moment and thing – how little do you actually have control or direct influence over? With so many variables in play – crude prices, election results, foreign policy, interest rates, inflation, monsoons and what not – the odds of your always selecting the best investments to be in at any given point in time, are actually ridiculously slim! Which is why, you sometimes have to (after considering all the facts and letting them percolate into your subconscious), take decisions based on a well-honed ‘gut feel’ or intuition. If you aim to ‘control’ every aspect of your investments and personal finances, you’ll probably struggle. Rather, make it your habit to evaluate rationally, and then ‘let go’ of the end result after taking concrete action. Funnily enough, you’ll discover that this approach pays off richly in the long term.