As the Summer Olympics in Rio kicked offed this past weekend, it is time again for us to marvel at the prowess of the best athletes in the world. They deserve all the awe we can muster, training that hard for that long- many of them all their lives- to finally compete for their respective countries in front of millions and millions across the globe. The process is truly amazing, and the reward of just competing on that big a stage is just as memorable. Whether you’re a veterinarian, bus driver, CPA or welder- everyone can be their own champion when it comes to their finances. If you practice determination, discipline and hard work in your financial planning you too can achieve a level of awe in yourself. The level of achievement will be different for each circumstance, but the feeling of being in control of your retirement planning, college savings for your children, investments or debt management, can be just as remarkable as the Olympians we’ll be watching over the next month. So challenge yourself to start, or continue, a healthy routine with your finances. This may require speaking with a financial advisor, reviewing your current financial plan, or simply saving an extra $10 each week. However, with enough tenacity and hard work, you too can bask in the glory that is being financially comfortable and prepared for the many obstacles everyday life will throw your way. This picture is from a long time dive bar near Ocean Boulevard in Myrtle Beach. It promises "Free Beer Tomorrow". Is that how your retirement plan or budget is working? Are you forever expecting to get started tomorrow? My neighbors had their granddaughter over this past weekend. She is a cute three or four-year-old who loves running around in the yard and looks to be a bit of a handful. This past Saturday, I saw her run to the front porch of their home and reach out to the roses that grow just about porch high each year. As she began picking the pretty flowers I heard her grandmother caution her “Don’t pick all the flowers!” So there it is, the gap between youth who want to take all of life in right now and the older, more experienced, generation who know you can’t take everything now or you won’t have anything to enjoy later. How we find that balance in our financial lives determines a lot of our financial future. Yes, you can spend everything now and have a whale of a time for a little while. Or you can spend some now and save the rest for another day. I turned on CNBC this morning to the news that the Brits had voted to leave the EU. The S&P futures showed a loss of nearly 4%. The British Pound dropping by nearly 8%. The announcers are interviewing anyone that will talk about the doom to come. In other words the sky is falling...again. Except that it is not. This is another example of the crisis du jour that causes too many investors to think like day traders. The long term effects may be substantial, but they will not be deadly. The markets will fall today, but they will not go to zero. If anything, this will be a chance to buy some stocks for long term gain. Remember, the price of the permanent ups of the stock market are these short term downs. We are in the midst of another US Presidential election cycle and again clients are worried about the effect the election will have on the stock market. While nothing can be predicted with certainty, we can look at history to get a feel for what might happen. Since 1944 all presidential elections coincided with a gain in the stock market, except two years that appear to be outliers. In 2000 as the tech bubble burst and in 2008 as the housing bubble burst and the credit markets froze stocks ended the election year lower. But barring any black swan event later in this year, I would expect a return to historical norms and a positive end to 2016 for equities. In the end it is profits not politics that rule the stock market. For those of us who enjoy watching competitive golf and also enjoy a great story of perseverance, this weekend’s US Open had both on display. Dustin Johnson had been struggling to close out a major championship after being close several times and just coming up short. Well yesterday he finally got over the hump of winning his first major, and I’m betting this will lead to more confidence and victories in his future. While watching this play out on Father’s Day, I found a particular parallel between Dustin’s story and finances. You see, just as Dustin was trying repeatedly to get over this major championship hump, I speak with many people who are trying to get over their own personal finance hump. Many people know what they should be doing- as in talking with a professional, maxing out their employer retirement plans, saving more, setting up personal retirement accounts or general brokerage accounts, etc. However, often times it takes a big leap to actually put these plans into action. So if you’re trying to get over that hump, to get into a personal savings/investment/retirement strategy that will help you reach your financial goals, reach out to an advisor or financial planner who can help give you that extra motivation to take that leap. The sooner you do it the better, and just like DJ this weekend, you’ll move forward with more confidence than ever before. You know Lake Wobegon from NPR and Garrison Kielor. It is the mythical place where “all the women are strong, the men are good looking, and the children are all above average.” Unfortunately, we cannot all be above average. However, if asked we will generally claim that distinction no matter what the subject, and this can lead to behavioral mistakes that cost our bank accounts real dollars. In finance like other areas of your life, try to play to your strengths and recognize your weaknesses. If you lack patience, the stock market is no place to learn. If you like taking risks, the markets will let you take plenty, and then send you home with nothing. If you are timid, you could easily talk yourself into staying on the sidelines- the ultimate financial mistake. Work with an advisor who helps you use your strengths and fills in for your weaknesses. It is not always about the opportunity, sometimes it’s about our attitude. Being that it’s June, it’s time to check up on your financial New Year’s resolutions. Have you stuck to your financial plan? Have you achieved more saving or paid down debt? Have you given up completely on your personal goals only to fall back into old habits? Did you even remember that you set any goals? No matter how you answered those previous questions, it’s never too late to reengage and refocus on the end game. Whether that’s saving for a down payment on a home, increasing your retirement assets or finally meeting with a professional to talk about these things- it’s as good a time as any to accomplish these goals. Just as many of us have fallen off the workout schedule or reverted back to the habits we were trying to end or alter at the beginning of 2016, it is easy to forget and abandon our financial goals as we go about our everyday lives. Now’s the time to refocus and rededicate ourselves to the financial habits that we know we should be practicing, but sometimes forget or find any excuse not to do. Whether you live paycheck to paycheck, or are fortunate enough to enjoy some financial breathing room. Once a month, I challenge you to enjoy the "No Spend Weekend". It might not sound feasible, but believe me, it can be done and is financially rewarding. Whether you go it alone or are married with or without kids, it's a great way to save some money and take control of your finances. I recommend going to the beach or park, enjoying a free local museum or social event, or simply getting some projects done around the house. The process is simple, just don't spend any money from Friday to Monday. You and your loved ones can enjoy some personal time, experience some things you don't typically do, and, oh yea...save some money! |
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