Are you emotionally attached to your financial plans? Probably. Should you be? Harder to know that. For now, let’s say “Yes” but only to a small degree.
You should be emotionally attached enough to pay attention, listen to advice and act on the decisions you reach. Seeking or even accepting drama is a losing proposition.
There are two ends to the emotional spectrum.
Both are wrong. If you are on the drama side then you are missing a key aspect of the whole scheme. You should organize your financial plan on the basis of what will work, not necessarily on the basis of what is fashionable, interesting or special.
If you find it too boring, then you will miss simple and easy to implement opportunities.
It is a little like trying to find a perfect smart phone.
I own an iPhone and have little interest in changing. It does what I want, is flexible and convenient. I don’t worry about security and viruses because Apple is pretty anal about what they permit. In simple terms it is boring. I used to have a Blackberry for the same reason. Two copies of a Playbook put me off. I was not bored enough to put up with the problems forever.
I could go and search out some newer, better, or faster phone but it could not be cheap enough to make me give up my security blanket that Apple has provided. It might be 20 grams lighter or have a 10% bigger screen or more memory or more apps, and I don’t care.
I don’t need the drama of being on the leading edge. Bleeding edge if you listen to the horror stories.
So it is with your financial plan.
If it has too little insurance or too much volatility, you are playing the drama side. Certainly, that has more entertainment value, but if you want entertainment, there are other ways to get that.
The question is, “Which do you value more, the destination or the journey?”
Almost everyone says destination, but their behavior begs to differ.
There are more but these are the common manifestations of people who are more interested in the journey that the result.
People will have more success if they understood what the performance needs to be to get to their destination and spent next to no time playing in the areas where they have only superficial knowledge. For example, the past few days have demonstrated that not many people who invested in precious metals have a good understanding of how they are priced. I have noticed that the ones who were most adamant about its probable climb are most surprised by its recent fall. I suspect that if they cannot explain the fall, they would be hard pressed to explain the why they expect the climb.
We are naturally emotional, especially when stressed. That is the time when an objective and skilled third party can help you to make sense of the whole thing. Presumably, because what was begun made sense and the variations can be explained in terms of the initial conditions, systemic change and initial assumptions.
The risk of not having and not listening to that third party is that you will make stress based decisions that are even less well understood than the originals. Fear and fanaticism are poor advisers. They are debilitating. Each can be overcome with knowledge and understanding. Listen to others who are not so emotionally connected.
This low drama approach can work with communities, family, relationships, business and more. Enough excitement to be motivated; not so much as to be debilitated.
Don Shaughnessy is a retired partner in an international accounting firm and is presently with The Protectors Group, a large personal insurance, employee benefits and investment agency in Peterborough Ontario. email@example.com