Undoubtedly, many of you watched the 2020 Tokyo Olympics over the last few weeks. As we watched many of the over 11,000 athletes that competed, it's easy to marvel at their achievements and level of success. These men and women undergo years of rigorous training, develop astounding mental strength and achieve nearly perfect physical peak performance.
As we enjoy the games, let's remember that there are some lessons we can all learn from these athletes - even lessons we can apply to our financial fitness. The mindset with which you approach your finances actually isn't so different from an Olympian's approach to their sport.
Defining Your Goals
All athletes develop tailored goals to put them on the path to success. Financial goals are the same; if you don’t lay the groundwork for your financial future by establishing goals and priorities, the financial future you want won’t be guaranteed. I know we hear about goals all of the time, but we too often don’t truly set goals. It may have been something we did more in our school days (e.g., achieve a certain grade point average, become president of this organization, lose weight so that you can get the courage to ask Mary out), but do we still have that fire to consider our goals as we plan for retirement and beyond?
Short-Term vs. Long-Term Goals
Athletes often have both short-term and long-term goals; a young track star may have a goal for their next meet while simultaneously working towards Olympic trials far into the future.
When it comes to your finances, you want to think long-term. Those goals could manifest through a retirement savings account, or perhaps an eventual college fund for your children. What do you want your financial reality to look like in the long run? What can you do now to make it happen?
Yet of course, establishing short-term goals is also crucial to your finances and intermingles with these long-term goals. For example, you might say “I am only going to spend ‘x’ percent of my paycheck this month,” or “I am going to set aside ‘x’ amount of money every month to save for a vacation next year.” By consciously thinking about your goals and how you can attain them, you’re already one step closer to financial fitness.
Athletes are notorious for the hard work they put in. Staying in peak physical condition and aiming for constant improvement requires immense discipline, as does staying in peak financial condition.
Even if you’re working with a financial advisor, you don’t have the equivalent of a coach that can bench you for failing to have discipline. An advisor can draw those lines for you, but you ultimately need to carry the will not to cross them.
This is especially true when it comes to your spending habits; when you have a budget, stick to it without exceptions. Once you make an exception, it becomes easier and easier to keep doing so. Your goals are nothing if you don’t harbor the discipline to make them a reality.
Similarly, staying disciplined with your asset allocation and investments are critical. Some athletes may chase that next great enhancing performance substance only to learn that shortcuts never workout in the long-run. Similarly, chasing that shiny new investment that your neighbor or the media touted may not lead to the best results. At Oasis Wealth, our adherence to evidenced based investing is that discipline that we feel leads to better long-term results. Discipline to the science will pay off.
Stick With it
The best athletes don’t give up, even when they fail; they stay committed and focused on their goals. Your finances can be unexpected. Even though having a financial plan is vital, things happen that we can’t possibly account for.
Don’t be discouraged if you do happen to go over budget or your investments aren’t doing well. Just like an athlete: pick yourself back up, refocus, and keep putting in the work to reach your financial goals.
Leverage the Expertise – and Passion -- of a Team
Even though those that reach the pinnacle of success have to be extremely focused and put a premium on personal accountability, they have to rely on others to bring expertise, encouragement, and accountability. A small change in training regime or a positive word or two can go a long way towards success for the world class athlete or for those that are planning for retirement and want to live a fulfilled life based on their resources.
The best coaches – and best financial advisors – don’t merely use their training and experience to bring positive results. Without a passion for seeing improvement, success, and happiness in the athlete or client, long-term success will not result and will certainly not be as enjoyable of a road for both coach and client. That is one reason why our advisors at Oasis Wealth are not merely focused on tax savings or investment returns – at the heart of our advice is life-focused planning. Helping our clients to use their money in a way that is meaningful for them is what we are passionate about.
Understand the Holistic Nature of Preparation
Merely focusing on the physical aspect of training will generally not lead to long-term success. In fact, ignoring the mental (and even spiritual) side of one’s preparation may lead to negative results. If athletes put too much success on achievement for achievement’s sake, burn-out or stress may result as we have seen with one of America’s all-time top athletes. Similarly, when planning your finances, it is important to not merely focus on the numbers.
Even though the numbers are important, planning for retirement or other financial goals should not be merely about “achieving your number”. That is one reason why our advisors at Oasis Wealth are not merely focused on tax savings or investment returns – at the heart of our advice is life-focused planning. Helping our clients to use their money in a way that is meaningful to them is at the heart of our advice and how we work with our clients.
Regardless of whether you are looking to achieve the pinnacle of success like these Olympians or merely looking to plan for a retirement that is authentic to you, it may be wise to use some of these lessons from the Olympians. While we do not give gold medals for success, feel free to contact us at Oasis Wealth if you want to reach the podium of fulfillment as you plan for and live out your retirement.