Want a quick way to end up in a financial mess (warning: NSFW language)…
I actually had an advisor early in my career tell me this. It wasn’t word for word, but the message was all the same. I needed a nice suit, expensive watch and flashy car to portray a high level of success, and the prospects would be lining up to meet with me. There was no way I could afford to present that image, and luckily, I never took the advice. Instead, I chose to follow the advice I would give my clients: live below my means, save for the future, but also make sure to enjoy experiences today.
In financial planning, and in life for that matter, there are certain things that we can control, and there are many things that we cannot. Rather than keeping our attention focused on the things we will never be able to control, we should refocus on those we can. We cannot control what the markets will do. We cannot control when the Federal Reserve will raise interest rates. We cannot control what policies our government officials will implement. However, we can control our behavior. We can control our spending habits. We can control our budget. Interestingly enough, the areas that we can control have far more impact on the success, or failure, of our financial planning than the uncontrollable ever will. Funny how that works out.
Trust me, I understand it’s harder than ever to try not to keep up with the Joneses. Social media blasts images of lifestyles we all desire in front of us every second of the day–baiting us to buy the car we can’t afford, or to go on a shopping spree with money we should be using to fund a Roth IRA. If you can avoid the temptation, accept where you are financially today (you don’t have to stay there), and live within your means, there is a much higher chance that later in the life you’ll be in position to have and do the things you want.
So, you can still act as if…just act as if you are who you are.
Disclaimer: Nothing on this blog should be considered advice, or recommendations. If you have questions pertaining your individual situation you should consult your financial advisor. For all of the disclaimers, please see my disclaimers page.