Here are the Steps to Success in Chess and Investing

Here are the Steps to Success in Chess and Investing

When you play chess, you need to take small steps to success rather than making grandiose moves or waiting for your opponent’s blatant blunders. A good chess player builds his defensive and offensive fortress slowly, accumulating small advantages wherever possible. The same idea applies to finance. Since it’s unlikely that you will win enough money in the lottery to support you forever, you’ll need to accrue money in reasonable, steady amounts. Over time, a collection of seemingly trivial sums adds up. The book Rich As A King: How the Wisdom of Chess Can Make You a Grandmaster of Investing suggests the following small steps to help you build your nest egg. (To watch a 3-minute video about this, click here.): Regular savings. Squirrel away $5 per day, and put it into a stock mutual fund monthly or quarterly over twenty years. If you net 6% per year on that pool of money, you’ll end up with over $67,000. (If you can save even more, great!) Lower fees and expenses. Look for ways to reduce small, recurring cash outlays. You could transfer your banking relationship to a lower-priced firm (saving $400 per year), pay off your credit card every month (or better yet, switch to a debit card) and save $2,000 per year in interest payments, and renegotiate your cable and cell phone bills (save $30 per month). Examine your budget to find other possible savings routes. Implementing these alone would allow you to sock away $3,800 every year. Get a better salary or find a second income. Could you find a job with a better salary, or perhaps work... Click for more
Why Learning to Play Chess Can Make You a Better Investor

Why Learning to Play Chess Can Make You a Better Investor

Today, more and more schools around the world are teaching children how to play chess. But you don’t have to confine your child’s chess lessons to the classroom. If you want your child to learn to play chess, sign up for a free copy of a Chess Teaching Guide for Teachers and Parents by Grandmaster Susan Polgar. What are the benefits of playing chess? Playing chess can help you improve your analytical thinking skills, confidence, and overall health. Murray Thompson, of Flinders University in Australia, carried out a study on whether playing chess improves scholastic achievements, measured by an increase in IQ levels. He concluded that IQ increased as a result of playing chess due to the concentration and logical thinking that players use when planning and making their moves. Several studies conducted among schoolchildren found that children who learn chess in school develop strong verbal, intellectual, and numerical abilities. For this reason, countries such as Armenia, Norway, and Spain teach chess as a compulsory school subject. Chess in the Schools teaches inner city public school students how to play chess as a means to improve their academic performance and aspire to better lives.  (To watch a video of an interview with the chair emeritus of Chess in the Schools, Lewis Cullman, click here.) Another study, published in The New England Journal of Medicine, found that when people 75+ played chess and other intellectually stimulating games, they were less likely to develop dementia than their non-game-playing peers. Chess can also teach financial skills Apart from all of the intellectual benefits that chess provides, you can also apply chess logic... Click for more
Does a Budget Tracker Really Help Your Bottom Line?

Does a Budget Tracker Really Help Your Bottom Line?

The way you play chess can shed light on how you manage your money. If you are a careful chess player and keep track of your moves, you might find a budgeting tracker a useful tool. In chess, you have a set number of pieces. In order to win, you need to use each piece in the most efficient way that you can. Rather than randomly moving around the board, you need to plan your moves based on the pieces you have available and where they are in relation to your opponent’s pieces. Similarly, when it comes to your monthly budget, you need to look at each dollar you have and use it most efficiently. If you don’t use what you have wisely, you may be left short before you get your next paycheck. If you don’t follow a budget, you won’t know where your money goes. This is why a budget tracker is extremely helpful. It allows you to become organized and methodical with your spending. The best budget trackers help you monitor your expenses, categorize them, and break them down so that you can plan better where to spend your money. Don’t let budgeting intimidate you Sometimes people feel overwhelmed when they first start tracking their expenses. Watching the list of categories where you spend money grow as you go through the month can be quite intimidating. Don’t let this scare you. Once you know exactly where your money is going, you will have a better idea of what you could cut. Budgeting is one of the most efficient ways to make the best use of your... Click for more
The Real Reason to be Financially Optimistic – Rich As A King Episode 131

The Real Reason to be Financially Optimistic – Rich As A King Episode 131

Can you afford to be financially optimistic in today’s volatile market? Susan Polgar’s stories about how she became a chess grandmaster are an inspiring illustration of how optimism can can pave the path to success. Find out why a positive outlook is one of the most useful tools for success, in chess, investing, and in life in... Click for more
Why Forward Thinking is Key to Chess and Money Management

Why Forward Thinking is Key to Chess and Money Management

Forward thinking is key for both chess and money management. Not only is that the basis for Susan Polgar’s and my book, but it was the topic of a conversation I had with Professor Harry Markowitz, Nobel Prize winner and father of Modern Portfolio Theory. What it takes to win Winning a chess game requires having a plan and executing it on a constantly changing field. Winning the financial game requires having goals and creating a financial plan that will achieve them, while accounting for unknown market volatility that will occur years in the future. Yet, it is not enough to have a strategic plan and be able to execute it… otherwise there would be more chess grandmasters and more millionaires in the world. This is what happens when a Nobel Prize winner analyzes a game of chess One of the main differences between a grandmaster and a recreational chess player is seen in the forward thinking skills they employ during play. Needless to say, when I played chess with Grandmaster Susan Polgar, I lost. Professor Markowitz analyzed why: “…try to think through the long-run consequences of a move.  So we play the investment game or the trading game one move at a time, and we have to think forward.  We use Monte Carlo to help us think forward, and good happens because of it.  So that is like chess.  Susan was able to think more moves forward and about more paths than you’re able to.” From here, it appears that the key to winning is strategic forward thinking. However, this does not mean thinking tens of moves ahead... Click for more