The Investor Diary Entry #78: May 5, 2025
Welcome back to the Investor Diary. This entry reflects my ongoing journey back into forex trading after many years of stepping away. In 2003, I first encountered the world of trading. I kept circling around it until 2011, when I ultimately gave up, thinking trading wasn’t for me. That phase was long and painful. But I’m back now, not suddenly, but after more than two years of steady preparation.
Since 2022, I’ve been laying the groundwork to return to trading. This blog is a reflection of the steps I’m taking, the thoughts I’m wrestling with, and the processes I’m building.
I write and share this for two reasons. First, for myself. Writing helps me digest what I’m learning. Repetition cements ideas into my thinking. Second, if you’re in a similar place, maybe something in my experience will help you.
Can I Afford to Trade?
Today’s entry expands on the first point in a previous article I wrote: personal finance. That article outlined ten key things I needed to understand before stepping back into forex trading. But this one focuses entirely on the importance of personal finance management in my process.
For me, personal finance in the context of trading breaks down into two foundational questions:
- Can I afford to trade?
- What are my financial goals?
When I say “afford,” I don’t mean “do I have some money in the bank?” I mean: do I have money I don’t need for anything else—money I can part with and never expect back? If there’s even a chance I might need that money in six months or a year, then that money is not tradable. This distinction is crucial.
Think about how we treat vacation budgets. If I plan a trip and set aside funds for flights, hotels, food, and so on, that money is gone in my mind. I’m not expecting it back. That’s how I now view tradable funds. That is the standard I use in managing personal finances around trading.
So, how do I act once I know the answer to the question “Can I afford to trade?” Whether the answer is yes or no, the action is the same: I do not open a live trading account. Not yet. Instead, I open a demo account.
If I have the money, I use a demo account to train. If I don’t have the money, I still use a demo account to train. I continue until I either build up the right capital or become good enough to transition when the capital is ready. Either way, the first step is training.
These steps for managing personal finances have proven essential to building the kind of trader mindset I want. It’s not just about having funds, it’s about knowing when and how to use them.
Lessons from the Past
This approach wasn’t something I grasped back in 2003. I wish I had. It’s part of what I now see as one of the most critical personal finance management tips: just because you have money doesn’t mean you’re ready to trade. There is no rush. The demo environment is there for a reason. It lets you build skills without risking anything. That’s a luxury. I’m learning to appreciate that.
Defining Financial Goals
Now to the second piece: financial goals. This is about having clear expectations and benchmarks.
In my plan, I’ve created very specific financial goals that my demo account must meet before I allow myself to go live. If I can’t meet those goals in a demo environment, I definitely won’t meet them in a live setting. And even if I do meet them in demo mode, that’s not a guarantee I’ll succeed in the real world. But not meeting them in demo is a sure sign I’m not ready.
There’s a psychological gap between demo and live accounts. Risk feels different. Pressure behaves differently. This is why I’ve added another rule: even if I reach my financial goals on the demo account in under three months, I still won’t go live until at least three full months of consistent success. It’s about discipline, not shortcuts.
Building Structure Over Passion
All of this ties back to the importance of personal finance management in trading. Understanding the money side of things gives me clarity. It keeps my emotions in check. It sets boundaries.
The truth is, I’m not consistently profitable yet. My risk management plan is still being refined. My trading methodology is in development. But I’m treating this like any serious business. Passion alone is not enough. You need structure, training, and patience.
I’ve learned that many people confuse easy entry with easy success. Just because signing up for a trading platform is simple doesn’t mean trading itself is. That’s a myth. The industry is challenging. The success stories you see on YouTube—where people are making huge returns—those are exceptions. Maybe they’re even true. But the foundation of those successes likely includes serious training, real financial planning, and a strong mindset.
The importance of personal financial management plays in all of this cannot be overstated. It’s the backbone of any sustainable trading journey.
Where I Am Today
This is why personal financial management is essential in my trading approach. I treat my journey like a slow career shift. Like moving from being an employee to starting my own business. If someone wants to blog, trade, or run a digital venture, they need training before launching. Trading is no different. It’s not just about the charts—it’s about having the right foundation underneath you.
To anyone following along, this is where I am right now. I’m still preparing. Still learning. Still building. And sharing it here, step by step.
Until next time,
The Investor
Monday 5 May 2025
About The Author
I started to look into individual stocks in January 2022. I created this diary initially for myself to track my investing progress, and second, as a place where I can share my ideas publicly hoping that others will share their ideas and learn from each other, and lastly as an online business where some links that I share are affiliate links, and if anybody bought anything by clicking those links, I will get a commission based on that successful sale, which of course will not affect the price that you are buying the product or service at.
For more detailed information on my affiliate disclosure please refer to the Full Affiliate Disclosure page.
Furthermore, this site is in no way or form giving any financial or investing advice, nor it is encouraging or discouraging people to buy or sell any financial instrument. This is a personal diary in which I track my own progress and share it for informational, educational, and entertainment purposes.
It is very important to use money you don’t need for anything else when it comes to trading, as it is volatile and you don’t know what is going to happen. My brother does a lot of trading and his rule of thumb is to only invest what he has made and not to add any of his own money in.
Demo accounts are also a great idea to practice and see what it will be like to make or lose money without actually losing anything. I think that most platforms have this option so that beginners can get there feel for the game.
Hello Michel, What your brother is doing is very clever. In my future plan, I am going to deal with profits the same as any organization. Decide on the percentage of reinvestable money. Meaning, how much I am going to withdraw, and how much I am going to keep as reinvestment.
The importance of a Demo account and how to treat it is so crucial and I cannot stress it enough to the point that it made me write a whole blog diary entry on the topic.
Thank you very much for your comment.