MoneyWalk 30: Diversify Your Money, Part 1

This program will help you undo financial bondage.

Are you familiar with the term, "don't put all of your eggs in one basket?" This advice was given so that a majority of eggs would survive and be useable in the future in the event of an accident. If you place eggs in several different baskets, you are less likely to drop all of the baskets. However, if you place all the eggs in one basket you chance that many if not all of the eggs will be broken if you drop the basket.

This concept makes the diversification principle in scripture a most worthwhile principle to include in your wealth building plan. The bible identifies the most important features as giving a portion to seven or eight and using a multitude of counselors to help you manage your life and resources. Yet, many people foolishly put all their savings and investments in one vehicle in one person’s or institution’s control instead of spreading the risk. They risk the loss of their entire life savings if that one vehicle goes bankrupt or they lose a lot of purchasing power if the value of that one investment vehicle drops substantially.

By diversifying your investments among a variety of counselors (advisors and saving/investment accounts), you drastically reduce the chance that you will lose your entire savings or much purchasing power. So, for future financial protection, invest your money with at least several reputable counselors and accounts. The accounts can hold investments ranging from stocks to bonds to fixed income government guaranteed investments. Some risk of loss should be considered an acceptable risk, especially if you are young and starting without a multi-million dollar inheritance.

You can further minimize your risk by:

Saving for short-term and emergency needs.

Investing for the long-haul (10+ years).

Thoroughly researching and intricately learning the vehicles you choose to invest in.

Choosing investment vehicles with positive long-term historical track records.

While diversification has not stop investment markets from going up and down and negatively affecting your investments in some short-term periods, it limits the size of such swings on your assets so they won’t be anywhere near those for people who had all of their money in the most risky investments. It also allows you to obtain greater overall long-term return than those who put all their money in risk less accounts. In addition, it definitely stops the ability of one person to Madoff with all your money.

Please pray for this ministry and email any questions. May God bless you richly as you follow His plan!!!
Proverbs 11:14, Ecclesiastes 11:2, Luke 19:13, Acts 6:2-3
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