I often get asked if it’s too late to start trading and I can very much relate to this question. I enjoy learning new things and I am interested in many things but as I just turned 32, I also sometimes ask myself if it really makes sense to start something completely new now.
In this article I want to share my views on the question whether it’s too late to start trading and how I manage my life and my goals to hopefully help and inspire you to chase your dreams.
Debunking the 10,000 hours rule
As so many, I also came across the famous 10,000 hours rule which states that you have to study something for at least 10,000 hours before you can become excellent at it.
This was an immediate downer for me because how in the world can I spend 10,000 hours on something while juggling trading, businesses, family and other interests? I struggled a long time with it because there were so many things I wanted to try but what’s the point of starting with something new if I will never be any good at it when I cannot invest 10,000 hours into it!?
I re-read the book and spent a lot of time thinking about it. Then it slowly dawned on me that the title and the book were misleading. The examples in the book were, among a few others, Wayne Gretzky, Bill Gates, the Beatles or world-class violinists. What I did not notice before is that I don’t even have the goal to be that good in the things that I wanted to do. I never aspired to be the #1 in the world in any given field and it was absolutely not necessary either for my purposes. I was not looking for perfection but I wanted to have fun, become reasonably good at something and just broaden my horizon.
If you want to become a better trader, you do not have to invest 10,000 hours – not even close. You do not need to become the world’s best trader to replace your job or supplement your income. Even being reasonably good at trading is potentially enough to trade profitably. And yes, it will probably take a few months/years but nowhere close to 10,000 hours of dedicated work.
Don’t let the 10,000 hours rule put you off. Unless you want to become the #1 in any given field, becoming good does not take that long.
Becoming a pro – guaranteed
One of the biggest problems that keep people from reaching their full potential is having wrong expectations and wrong beliefs about what is possible.
Most overestimate what they can do in the short term & underestimate what’s possible in the long term
In our pro trading room (click), we try to help our traders establish realistic expectations early on because we have seen what having the wrong mindset can do.
If a trader believes that he can turn $1,000 into $1,000,000 in a few months, then he will approach his trading from a wrong mindset. He will start gambling, over-leverage, trade too much and get easily frustrated when his results don’t look good. Such a trader will never become profitable.
But if you are just trying to generate 30% – 60% a year ‘conservatively’, then profitable trading suddenly looks much more realistic. Many traders could achieve a monthly return between 2.5% and 5% comfortably but fail because they believe that they have to double their account every few weeks.
Disclaimer: Hypothetical performance
I started running a few months ago. I had 3 major knee surgeries over the years and I was on crutches for more than 18 months total. Some doctors said that I might need an artificial knee and running was out of the question. I started with weight and mobility training a few years back to slowly build muscles and protect my knee. When I felt good, I started walking slowly for extended periods of time and then a few months back I started running with faster pace. Every week I added a few hundred meters to my runs. I started with 2 kilometers runs and I am now at 12kilometers per session without pain or discomfort. It’s amazing what adding just a few hundred meters every week can amount to over the long term if you just stay patient. Had I just started running for miles right at the start I would have crushed my knee and I would probably have an artificial knee by now.
Just making small improvements week after week will almost guarantee that you will reach your goal over the long term if you stay consistent, remain patient and do not screw up in the meantime.
The action plan for reaching your goals
I understand that the goal of becoming a great trader can feel overwhelming and like an impossible task. Especially if you have been losing money consistently in trading, you still have a 9-5 job, a family, sports and hobbies, then also starting a profitable trading career seems almost impossible.
So where do you start?
You have to break your goal down into small and manageable action steps. Even better, break them down into SMALL daily or weekly goals and tasks that you feel you can do easily. Those can look like:
- Write your trading strategy game plan and become clear about your trading strategy (free template here)
- Start doing a 30 minute market analysis every morning to check for setups
- Do the same in the evening. Set aside 30 – 90 minutes and review the day, plan trades and manage existing positions
- Journal all your trades at the end of the day or week if you don’t have as much time – get our trading journal here
- Do a full review every Saturday or Sunday of your past trading week
- Look for similarities in your winners (so you can do more of that) and look for similarities in your losses (so you can stop avoiding it)
This feels much more manageable than just thinking about your long-term goal of “trading profitably as a full-time trader”. Those action steps will slowly transform you into a better trader and help you establish consistency in your trading approach which will then lead to consistency in your trading results.
When you write a book, don’t set yourself the goal to write 2000 words every single day – that will put you off right from the start. Just aim at writing one good page per day and over time, you will have a book. If you want to build a wall, place one brick a day and soon enough the wall will be completed.
“Never give up on a dream just because of the time it will take to accomplish it. The time will pass anyway.”
Whereas if you don’t break your goals down, you will feel overwhelmed and easily get frustrated and then quit.
Building your dream life today
The average life expectancy in today’s western world is close to 80 years and the life quality in old age also improves with better medicine and research. So if you are 30 today, you still have 50+ years ahead of you and if you are 50years old, you will live probably around 30 more years. That is a big deal!
Wouldn’t it then makes sense to invest a few years into something that you feel passionate about and want to get better at?
And wouldn’t it be a good investment of your time to spend a few years trying to become a better trader if you still had 30, 40 or 50 years more to live?
Your 50 years old self will thank you for your long-term perspective today.
I remember vividly when I was 25 I wanted to start new hobbies but I felt that it would be a waste of time because I would already be 30 years old by the time I would have had acquired any level of professionalism. Being 32 years now I look back and I wished that I had more foresight.
Nowadays I use this as a reminder and whenever I want to start something new, I know that it will be worthwhile and in a few years I will thank my younger self for planning ahead.
So whether you want to become a better trader or have other dreams and passions, start today. It definitely is not too late and even if it takes a few years, you will be happy later about your decision today. Time will pass anyway so make it worthwhile and approach your life with a little more foresight.
PS: Here is a GREAT TED talk that I have recently watched and it fits in perfectly here