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There was a large scale research study done by Gallup Consulting Group (a hugely credible global research company) this year which shows that the majority of people under 35 years of age do not own any form of shares/equities through investments, pensions or savings. This is in comparison to 2007 when the majority of people under 35 did own some for of equities. The research also demonstrated that the majority of people over 35 years of age held them in 2007 and that today the majority of people over 35 still hold them! It got me thinking! I remember vividly cycling my bike on my way from school when I was about 7 years of age and living in Skerries (yes I originally hale from 'enemy territory!). I was cycling along a quiet street and was passing a row of parked cars on my left. I was probably imagining I was Sean Kelly in the Tour De France and so getting a buzz from cycling past the cars a little too close, and mistakenly clipped one of the rear view mirrors of what I think was a Renault 11! Now i barely clipped it on my little peddler, i didn't even move it or damage it in any way. However that didn't stop what I can only assume was the owner of the car, who happened to be standing on the path beside the car, from letting an almighty roar at me, followed by some sort of fist-waving expression and a brief chase. It all seemed a huge over-reaction and a deliberate attempt to scare a young boy on his bike! Needless to say the harmless young Paddy was terrified and with increased motivation cycled home at a truly speedy pace! Not sure why this was so ingrained in my memory however I do know that for the remainder of that school year I avoided that street altogether for fear of encountering the 'Reno Man' again! I ended up cycling a very long way to and from school and cost myself lot of unnecessary time and concern. That was the first time I experienced being bitten, and then being twice shy about repeating the experience. However I happened to pass the 'scene of the crime' as a teenager and it reminded of that day, but to say the least there was zero fear about encountering the 'Reno Man' again, if anything I was keen to see him so I could tell him what I should have told him that day! On reflection it was OK to feel the fear but it was foolish to act upon it and to then pay the price and the inconvenience for the rest of the year! You might wonder what this has to do with investing in equities (quite rightly!). My take is that when it comes to pensions, investments, savings and all that boring stuff the truth is that many of us got quiet a fright 10 years ago (seems much more recent than that!) when the Global Financial Crisis hit. Anyone that owned equities/investments/pensions during that period felt the fear, the concern and either made a decision to act upon that fear or to do nothing! A typical portfolio fund in an investment, personal or Director's Pension with 80% Equities and 20% Bonds fell by 35% from January 2008 to December 2008. A portfolio with 100% equities fell by 40% in the same period. Forgetting about the fact (yes the FACT!) that they both rebounded by 55 and 70% respectively in the following 12 months, this was a genuinely scary time for investors. Many people made the mistake of getting out of Equities during these temporary declines. They panicked. Some may have been forced to, as in they needed to get their hands on the money for some genuine emergency, but the vast majority who sold their equities during the temporary decline did so out of fear and panic. In order to relive it let's picture a scenario. In 2006 everything is rosy. The Irish economy is booming, the good times are here. Bertie and his merry men are saying that this will last forever, that we're a mighty little country and that we should keep spending and lapping it up! Investments have delivered double-digit growth for past few years (since the tech bubble) and there is no reason to doubt that it will continue. You see your investment or pension pot grow in value from €200,000 to €250,00 over the course of 2005-2006. You are happy, you buy a few more houses, you buy a new car, install a new en-suite, a hot tub Jacuzzi out the back garden. The new decking is looking fabulous and your neighbours are all envious! All is well in the world!! And then WHACK! The global economy collapses, we lose jobs, Joe Duffy is telling us the world is coming to an end, Lehmans Brothers and a few 'big hitters' (non prudent ones obviously!) go bust. Your property empire starts to crumble. Your decking goes mouldy and your hot-tub doesn't get used anymore because you're too busy worrying about things! Your investment/pension pot falls in value by 40%, from €250,000 to €150,000, and continues to fall. You fear for your life savings. What is going On? What Sort Of A Fund Is This? Will I lose It All? These are questions you ask yourself or indeed ask your broker or advisor. They probably don't have an answer that assures you in any meaningful way. What happens next defines whether this investor achieves financial success or not. Full Blog at www.informeddecisions.ie Paddy Delaney QFA | RPA | APA | Qualified Coach