Someone asked a well-known scientist, “What makes you different from other people?” He said, “Everything came from something I did as a kid.” When I was 5, I was trying to get a bottle of milk out of the fridge. I lost my grip on the bottle, and it slipped and fell, spilling all the milk. When my mom saw this, she didn’t yell at me. Instead, she said, “The damage is done.” Do you want to play in the milk before we clean it up?’ When he was done playing in the milk, his mother told him, “When you make a mess, you also have to clean it up.” After he cleaned up the milk, she told him, “This was a failed experiment in how to carry a big bottle with two small hands.” Let’s put water in the same bottles and see if you can carry them without them falling over.’ The scientist said, “At that moment, I realized I didn’t have to be afraid of making mistakes, because I knew they would teach me something new. Experiments in science are all about finding out things like this. Even if they fail, they teach us something.”
Thomas Edison, who was also a famous scientist, said that it took him 10,000 tries to get the light bulb just right, but he said, “I have not failed.” I just figured out 9999 ways that don’t work. We also make mistakes as investors, such as trying to time the market and getting it wrong, not following a prescribed asset allocation, stopping SIPs in a bear market, investing in a single asset class without diversification, investing in stocks for a short period of time, etc. For example, people who saw the upcycle in 2003 and then the downcycle in 2008 would have learned that staying invested through cycles and investing regularly is a good way to build wealth over time. In fact, mistakes might not cost anything if you keep learning from them and getting better.