First of all, let me apologize…
Last week, I moved to a new email newsletter platform and mistakenly sent out last week’s email twice. Once from each platform. 🤦♂️
Sorry about that!
If you’re reading this, all is working as it should…
More Complex, Please
I’ve been a financial advisor for almost 28 years now, and no one has ever asked me to make their life more complex.
With work, family, homes, yards, travel, friends, and other commitments, I’m sure you already have enough going on in your life to make your head spin most days.
So it would be silly for someone to seek more complexity, right?
Well, sometimes I wonder… 🤔
I’m pretty sure you aren’t actively seeking to make your financial life more complex or any more difficult than it needs to be.
Why would you?
But based on some of the things I’ve seen over the years, and continue to see today, I’m not 100% sure about this.
Add to this the fact that many so-called financial professionals rely on complexity to make them seem smarter.
Or to charge more fees.
Or to sell you something you likely don’t need (and almost certainly don’t fully understand).
Rather than helping you simplify things in your financial life, many of these “advisors” are actually encouraging you to complexify your situation.
But I am sure they don’t refer to it that way.
Instead, they probably use financial industry jargon, some of which you’re not quite sure the definition.
Or they use scarcity tactics like how “this is only for a limited time” or “for certain of their clients,” etc.
But this isn’t just about some advisors being a problem, though some of them definitely are.
You might be your own worst enemy when it comes to unintentionally complexifying your financial decisions.
Rather than having a strategic, financial-planning-based portfolio of investments, you might instead have a random collection of investments you’ve picked up and/or were sold over the years.
If having one credit card is a good idea, having five or eight or more must be a great idea!
I often encounter folks with 3-4 checking accounts, 2-3 savings accounts, and more spread across 2-3 different banks or financial institutions.
And on top of all this, some of you are always reading (you might tell yourself it’s “research”) about what you “could” be doing with your money.
Where you can get another 0.05% interest on your savings.
Or how you can get $200 if you open a new account with this bank or that.
Or how you can get zero interest for 18 months with a new credit card.
OK, let me get down off my soapbox for a minute.
Should you just ignore your money and accept your current setup?
No, not necessarily.
In fact, almost certainly not.
But as I’ve written about before, I do believe the idea of “enough” applies to your daily financial life just like it applies to your long-term financial planning.
Yes, you want to be doing enough, but how do you know where to draw the line between enough and too much?
I believe that just like your financial plan, you need to strike a healthy balance between being well prepared for an uncertain future while enjoying your financial resources today and each day along your life’s journey.
In my financial planning work, I have some tools that can literally help us measure this balance between the future and the present while also “stress testing” your plan against whatever investment markets may do down the road.
Good or bad.
Great or awful.
And while I don’t have a tool or even a rule of thumb to help you evaluate “enough” when it comes to the setup and daily management of your personal finances, I actually believe that less is more.
Go with simple.
Go with less.
Make your life and your decisions easier.
Yes, you might miss an opportunity here or there to save a few bucks or put some extra cash in your pocket, but as financial writer Ramit Sethi says (and I agree with):
jason @safaiyehI used to obsess finding a savings account with 0.1% more interest. Hours spent to gain a few extra dollars a month. @ramit put in my head to ask thousand dollar questions not $3 questions. How do I increase my income? How do I reduce how much I spend on useless things?
Don’t complexify your life.
Don’t let others complexify your life.
I suspect you have better things to do with your time and your attention.
Hit reply and let me know what YOU think about this idea. 💡
Speaking of Simple
This recent NYT article does a good job of laying out a simple approach to investing that anyone can benefit from, whether you’re a beginning investor or someone who’s getting ready to retire.
I didn’t see anything in this article that I disagree with, but what do you think?
Hit reply and let me know.
A question I like to ask myself and often ask my clients is some version of “why not?” or “what if?” ❓
Why can’t you sell your home, downsize your life, and semi-retire now at age 50-something?
Why can’t you take some classes or go back to school and learn new skills so you can quit your soul-sucking job and do something you’ve always dreamed of? (In fact, you might not even need classes or school to do this)
What if you took a 1- or 2-month sabbatical to travel with your children while they’re still young?
Or quit you job, travel with your family, and then find better, more fulfilling work?
What if you volunteered more of you time with that organization that you’ve always admired and wanted to be more involved with?
These “why nots” and “what ifs” could fill pages.
I’m sure you can easily come up with a few yourself without even breaking a sweat.
We often tell ourselves that money is standing in the way of doing the things we’d really love to do.
And I’m confident that money 💰 is a part of it.
Perhaps a big part of it.
But I think fear 😱 is the biggest obstacle when it comes to imagining and doing something we’ve only ever dreamt about.
Fear of failure.
Fear of what others will think.
Maybe even fear of success.
But just like most financial decisions, these what if scenarios aren’t all-or-none.
They’re not always mutually exclusive.
Or they certainly don’t have to be.
You’re only going to get one shot at making the most of your one life.
Why not make it the life you really want to live?
What if you succeed?
Thanks for reading, and have a great rest of your week.
And, by the way, with this new email system, you can:
Until next Wednesday,
Why indie music? Please read the Postscript of Issue #2 for context.