The internet is filled with “financial advice,” but here’s a secret: 99% of it isn’t worth the time it takes you to read or watch it.
Why? Because most of it is just so-called “experts” telling you what works for them, and not what actually applies in your own life.
Something similar happens in golf all the time. Ben Hogan’s “Five Lessons” is one of the best-selling golf instruction books of all time, but there’s an untold story. Hogan had a nasty hook. His five lessons are all about how Hogan overcame his hook, not how the reader could improve their own golf swing. He taught you to golf like him, not golf like you.
Finding your financial swing is about building a mental framework for how you can approach money in order to build wealth, obtain financial security, and lead a more fulfilling life.
Here are the nine tips to help you find your own financial swing:
1. Play your own course.
We all have different financial circumstances at different points in life. Know what the hole you’re playing demands, build a strategy within your comfort zone, and execute each decision accordingly.
2. The ultimate goal of money isn’t more money.
Money is a means to an end, not the end itself. Define your goal, whether it’s becoming debt-free or financially independent, and direct your time, energy, and talents towards earning money to achieve that goal.
3. Value your time.
Your time has value. You trade your time to earn money. You spend some and save the rest. Once you’ve saved enough, you buy your time back. There are two ways to change this equation:
- Save more and spend less.
- Increase the value of your time with practice. Never stop practicing.
4. Accept luck’s influence.
Luck will be an ever-present factor in your life. You can’t control it; you just have to plan for a bad bounce every now and then.
5. Pick the equipment that’s right for your own game, not someone else’s.
Fame, status, luxury cars, and big homes are a part of some folk’s value system. They may or may not be a part of yours. True wealth is aligning your actions with your own values, not someone else’s.
6. Penalty strokes are the silent killers of wealth.
They will compound errors and inflate your score. Pay taxes at the lowest effective rates. Leverage interest to acquire assets or improve future income. Avoid fees at all costs.
7. Good decisions start with evaluating the risks in front of you.
Evaluate risk through three dimensions that are unique to you:
- Risk Tolerance – your psychological appetite for risk
- Risk Capacity – your ability to bounce back from a loss
- Risk Need – your ability to reach your goal without risk
8. Long drives are nice, but wedging and putting are what wins.
Chasing investment returns will often leave you in the woods. Much of your investing success will be dictated by doing the little stuff right.
9. There’s no prize for being first to finish nine holes.
Build a plan to keep you in the game long term and never unnecessarily interrupt compounding.
Your financial swing is unique to you and your financial course.
Each of these tips will mean something unique to everyone. Your financial swing will not look like your neighbors, coworkers, or friends. You’re all playing on your own financial course. Use these tips to master your own green, and enjoy the walk along the way.