The following are principles that I’ve adopted over the years when managing various financial and life decisions for my family and also for clients.  This is by no means a complete list, nor should it be taken as advice.  Just some reoccurring themes that standout at various stages through the wealth lifecycle.

  • Planning first, portfolios second. Every account you own should be guided by a job description and purpose.  You determine what role your money plays based on your priorities.  Having a plan gives structure to your investments so you know how to gauge next steps including just sitting still.  Without a plan how is it possible to determine progress towards what matters?  Most investors focus their energy on investments, rates of return, and transactions instead of sustainable practices that may build wealth.  Setting aside time to proactively check in and review where you are may reduce worry and lead to more confidence.  This provides accountability in adjusting awareness and habits back to where they need to be.


  • Understand your clock. Know exactly how much time you have relative to your goals.  An average couple, age 62, who retires today is staring at a 30-year time horizon or longer to stretch their financial resources and enjoy their life.  When you think of your future income needs in blocks of time defined in decades as opposed to months or years, your perspective changes.  Not all decisions, goals, and needs are long term in nature.  Embrace cash and liquidity so you are ready for all possibilities.


  • Understand the difference between volatility and risk. Volatility is price movements, the up down in either a positive or negative direction. The pandemic ushered in a tremendous amount of negative volatility as prices and values of all companies contracted.  Currently, we are experiencing positive volatility as these same company values are extending to all-time highs.  Often, these price movements are confused as risk.  Risks are different and maybe hedged or addressed in various ways.  You cannot avoid volatility and still expect to grow your investments to keep pace with the rising cost of life.  A successful investor understands volatility is what’s necessary in order to maintain purchasing power in the long run.


  • Know your debts: Be clear on what you owe, interest costs, and the timeline until your balance is zero.  When possible, make more than the minimum payment so your debt shrinks more quickly.  Once paid off, repurpose the debt payment to a job description that supports your goals and plan.


  • Utilize automation whenever possible. Your brain can only handle so many decisions a day.  Setting up automated investment instructions based on your priorities save time and make a difference.  Financial plans are all unique, but they all have one thing in common, cash flow.  Automation may allow you to get the most from your cashflow and direct the right dollars to the right account.  This keeps the important monies flowing like a river even when you are not thinking about it.  This allows you to focus on your behavior which often dictates the success of your routine.


  • Don’t confuse income as wealth. Income is what you earn in exchange for your time.  Wealth is what accumulates in the long run and may allow you to repurpose your time one day.  Repurposing your time on your terms is so much more important than income.  Having the ability to do what you want, when you want, with whom you want, for as long as you want is priceless.


  • Define what enough means to you. Know what enough time and money mean to you and those you care about.  More is what we are all chasing, it’s everywhere and maybe problematic in our everyday life.  Seek to understand and explore what enough means to you so you may be happy with what you have, regardless of the amount.  After all, it’s your decision, not your neighbors or social network that define what enough means to you.


  • Spend your money with a smile 😊. There is absolutely no sense is deferring purchases (essential or discretionary) forever so spend on yourself and others.  It may be hard to flip the switch and begin consuming after decades of investing and saving.  Take some time along your journey and make some small and big-ticket purchases.  Enjoy what you have and the choices available.  Smile as you spend!


  • Loosen your grip. Life is messy and rarely do things go as planned even when you have a plan!  Do your best and remember rarely are things as great or as bad as you think they are.  Setbacks, surprises, and opportunities will appear along the way.  Try to exercise a little bit more patience.

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