February 29, Leap Day. We all get an extra day, so what will you do with yours?
Leap at an opportunity? Leap for joy? Leap frog the competition?
I like the word leap. It even sounds like action. Maybe this leap day is the day you start taking action on something that will improve your life or improve the life of others. Even if it is just a calendar accounting entry we can still keep it special in our heads and use it to achieve something worthwhile.
Believing that things will get better or that tomorrow will be a better day is at the heart of optimism. If you look back on history, there have been many times to try the optimist’s soul. The Dark Ages, the Black Plague, WW I and WW II, the Great Depression, the Great Recession. But at the end of the day the pessimists and doom Sayers who called for the end of the world as we know it were all wrong, and the optimists were right.
I choose to be an optimist because looking back over history, optimism is the only view that reflects the reality we live in.
You know you can’t push a string. If you try you just end up with a jumbled mess. That’s why it is so hard to thread a needle, you have to push. If you need to move a string it works best if you pull it.
That’s how it is with financial matters. I can’t push you to do the right thing. I can only pull you along. If you don’t want to go and dig in your heels it becomes a tug of war and then neither of us makes any progress.
So if you want to get from point A to point B I will try to pull you along, you have to help too by following along. You have to care as much as I do!
Trying to reach your long term financial goals can be a bit overwhelming at times. Sticking to your budget can be onerous.
Do your long-term goals include action you can take today? If they don’t, then you’re probably not going to get there. If they do, then that’s the only thing you really need to focus on.
You only need to succeed today. Just for today keep everything on track. Just for today skip the latte or the drinks after work. Just for today make a contribution to your savings. Just for today. Worry about tomorrow tomorrow.
A lot of the problems I see when working with clients on a financial plans stem from a very simple lack of awareness. We are not aware of how much money we spend each day, each week, each month. We are not aware of what we should do each day to reach our short term or long term financial goals. We are not aware of how a contribution to a 401k plan today translates into income thirty years from now. We are not aware how much putting a $1,000 spending spree on a credit card will cost us over the next twelve months.
Awareness comes from practice. You have to train yourself to think about the moment and the future. Be aware that you are spending $50 for drinks tonight instead of saving for a great vacation. Be aware that that lunch out every day could cost thousands each year in retirement.
Be aware of what your goals are, so you can be aware of whether you are getting closer.
Final in our Oscar week series on money and the movies. From "Jerry Maguire" the following exchange.
Dicky Fox: Hey, I don't have all the answers. In life, to be honest, I failed as much as I have succeeded. But I love my wife. I love my life. And I wish you my kind of success.
Why do we work and save and plan? It is not to have money for the sake of having money. It is because being financially successful gives us choices and buys us time. Time to enjoy the things that really matter. The choice of how we live the rest of our life. Don’t get confused about what this is all about.
Continuing an Oscar week tribute to financial planning lessons from the movies.
Doyle Lonnegan: “I put it all on Lucky Dan; half a million dollars to win.”
Kid Twist: “To win? I said place! ‘Place hit on Lucky D’ That horse is gonna run second!”
Here’s a warning about putting all your eggs in one basket and being greedy. No matter how strongly you feel about Netfilx, or how much you love Apple products, never,never,never own enough of one stock to make a killing.
If you can make a killing, you can get killed.
In our continuing salute to the movies and financial planning lessons, this line from the 1960 oater classic "The Magnificent Seven"
Calvera: If God didn't want them sheared, he would not have made them sheep.
Be careful out there. The investment world is full of charlatans who promise you something for nothing and usually you end up getting nothing for something.
One of the oddities of being a financial advisor is you learn that people mostly hear what they want to hear, and believe what they want to believe. I have seen portfolios with high priced annuities that come with a “guarantee”, limited partnerships that promised high distributions, but instead went down the tubes with no liquidity. I have been pitched non traded REITs that somehow find better real estate than their more liquid cousins that trade daily on an exchange.
If you are considering an investment be sure you understand it and trust the person offering it to you. Listen with your brain not your heart. Maybe record the conversation to listen to later when you can separate the opportunity from your desires.
For Oscars week we will take a look at financial planning and the movies. Take these lines from the movie Mad Money released in 2008.
Molly: “That could be your savings account!”
Bridget Cardigan: “I don’t think so; it has money in it.”
Having a savings account is one of the very first steps we have to take to reach any long term financial goal. Without saving how will you take advantage of any of the great opportunities you will stumble across during your life. It is such a basic step that few words are every written about it, but it is like crawling before you learn to walk – necessary.
To wrap up our Grammy week tribute to money and music here is one of my personal favorites. Keb’ Mo’ presents a playful and sarcastic tune to get us to think about the things we give up for Mo Money.
Well I needed a part for my washing machine
They picked up the call in the Philippines
I got a Chinese phone and a Japanese car
But the gasoline takes me twice as far...