Broker Check

New Year's Financial Resolutions

January 06, 2022
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Every single website I can think of is posting what your financial New Year’s resolutions should be.  So I’m going to put in my 2 cents in my own very insightful (and maybe slightly sarcastic) way.

  • Pay yourself first

If you’re working with a financial planner then hopefully you have a financial plan in place!  That plan is the building block to multiple future goals that you have set.  Put that plan on autopilot ... your 401K, life insurance, college plan, investments, savings plan should all be set to automatically transfer out of your bank account into those other vehicles as if you never had the money.  You know what is great about paying yourself first?  You get to spend the other money on fun stuff.  So next time you grab a steak order a bottle of Caymus instead of the house red.  

  • Stop reading headlines to make your planning decisions

Nothing works in a vacuum with financial planning.  Every single person and family are unique.  I could have two families in which the spouses are the exact same age, the kids are the exact same age, their jobs and salaries are identical, yet their plans are completely different.   Why?  Because people have different priorities, they have different goals, they have different fears.  I recently read a 15-tip finance blog from a Harvard economist.  He recommended paying your house in cash and if you can’t afford it then move somewhere cheaper.  Oh ok, thanks.  He also said if you get married plan on getting divorced and plan on taking social security at 70 because retiring early is a terrible decision.  This guy sounds like a blast. I think I’m going to invite him to my next Labor Day party.  If those are the types of things you want to do then good for you, but everyone is unique.

  • Stop reading headlines to make your investment decisions

This one is pretty simple for me.  If you’re reading something on Market Watch or Yahoo Finance, trust me Wall Street knows.  Information that makes it to these public sites, blogs and forums have probably been floating around for a while.  Have you seen Billions?  My point is, the next great stock idea probably isn’t coming from a paid ad on your Facebook feed.

  • Be consistent

Trying to time the market is an exercise in futility.  Last year we saw meme stock mania and crash, IPO and SPAC mania and crash, “hyperinflation” that turned to “transitory” inflation that turned to actual inflation, bubble this bubble that, the Delta variant, the Omicron variant, Russia on the Ukraine border…what did I miss?  So what did the market do?  The S&P laughed at it to the tune of a 28% return and 70 all time highs.  There wasn’t a single technical correction (>10% drop peak to trough) during the year.  I’m not saying a correction won’t happen or that this bull market will never end.  But I am saying you can’t use headlines to predict the future of the market.  Time IN the market tends to beat timING the market

  • Be prepared

Ok this one is a little more serious.  Last year the Birds Eye family lost 4 clients and personally, I lost some great friends.  All of these folks were at different stages in their life.  Some had planned perfectly, others didn’t.  The downside in my industry is consistently seeing real life rear its ugly head.  I realized right away what I thought couldn’t happen to me definitely can.  Have your will done, get your life insurance in place and properly plan for your family.  Some of you reading this are saying, yeah Rob’s talking about me, you know who you are!  Trust me, that glass of Caymus tastes a lot better when you know your family is planned for.