Recapping 2012 Part 7 of 7

2012 TimelineWell here it is, the end, the last day of 2012, and this is my last post looking back at the year. My next post will be looking forward. It’s important to know and understand the past but that’s only so you can plan your future. Going into 2013 I thought this post would be a good reminder that every decision you make has consequences so the sooner you make good decisions the better off you’ll be. Looking ahead means projecting several outcomes from each decision and deciding which is the most likely and which will serve you best. Here’s to taking the right combination of paths in 2013!

Action and Reaction

Early in our school lives we all learn about Issac Newton and his apple mishap that led to his theory of gravity. Well Newton also had some laws of motion and his third law of motion loosely states that for every action there is an equal and opposite reaction. Welcome to world of consequences. For every choice you make there is a choice (or several) that you did not make and every decision leads to a result, good or bad.

Consequences start at a young age. Things you have control over but often don’t have the maturity to appreciate, like the importance of good grades, for example. Once we move on to the next level in life we choose our major in college or career in life, and we would do well to choose wisely. How many people are willing to go into debt for an education that may not provide the means to easily pay back that debt? That one decision will have ripple effects throughout life.

How many people delay investing in their retirement accounts early in their working lives because they think they can’t afford it, because it will negatively affect their lifestyle? The fact is that their lifestyle will be much more adversely affected in old age if they wait too long. It’s not that they can’t afford it now, it’s that they won’t be able to afford it later.

Taking a What Next approach to decision making is to weigh as many options as feasible, and to choose carefully. Asking What Next means you have a long term outlook and understand the ramifications decisions have. In financial planning terms that means understanding the future value of a decision. Put simply, the future value of a dollar invested today at 10% interest is $1.10 one year later. The future value of not going into debt to fund your education is the ability to start saving earlier and building your retirement nest egg sooner.

I don’t have children but I think I might have spent more time talking about the consequences of that decision with Julie, than most people who do have children. I’m not sure I can think of a weightier decision than the choice to have children and yet I wonder how many people treat it with the reverence it deserves.

The everyday choices we face today will affect the life we have later. Buying a house, a car, toys, taking lavish vacations, all diminish your ability to save for the future. Whether you stay in your home for a long time or move frequently, whether you buy a new car every couple of years or hang onto it for a decade, will determine your level of success. It is a balance between now and then.

The question for you is, are you well balanced? (I know what some people say about me – so let the jokes begin) Do you have a long term outlook on life? Are you confident that your choices today will still look correct a year or five years from now?

Share some examples of long term decisions that have paid off for you and some that didn’t.

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Lessons from Juggling

Juggling BallsIn my last post on juggling life I asked you to watch a video that was at the bottom of the text and apply what Michael Moschen was saying to life, not physical things. In this post I’ll do it for you, give you my perspective on his talk. I understand we’re all busy and watching a 38 minute video might not be possible or practical.

The first lesson Mr. Moschen gives is knowing where the ball is in time and space, being aware. Where are you in time and space? Have you achieved the things you want when you wanted them? Too many people don’t know, don’t keep track of their progress, of their goals. Too many people are not aware.

The next step, once you know where you are in time and space, is adding complexity. But notice that he only added the complexity of vertical movement, he didn’t add several items, he added one! How many of us add complexity before knowing where we are in time and space? How many of us add several layers of complexity at one time? Too often, I think, having children comes first then we figure out how to make ends meet. Too often people start businesses and quit their job before they figure out how to make a profit.

Third was balance illustrated by a broom perched on his chin, forehead, and even his ear. Balance is making sure you’re the center. If the broom begins to list left, move left, to center yourself under it. As you begin to learn balance the movements are dramatic but the better you get the more still you become, the more you realize the power in small adjustments. Are you making small adjustments in life or are you waiting until the broom has almost fallen over?

The last items, not mentioned by name but clearly evident, were curiosity and experimentation. These are themes I talk a lot about in What Next, the book, and in this blog. Curiosity and experimentation is what leads to discovery. Seeing things in a different way is what inspires Michael Moschen to put movement to inanimate objects creating stunning visuals. Most of us look at the same things, in the same ways but the few who can look at the same things in different ways or who find new things are the most successful.

Here’s a similar type of juggling that I just had to share – and it’s much shorter than 38 minutes!

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My Gullible Gut

Trust Your GutHow many times have you heard the phrase “go with your gut” or “trust your gut?” I used to think that way myself but I stopped a long time ago. Why? Because my gut is really gullible, my gut would believe anything!

I’ve never met a business idea, an investment, or a person I didn’t like, at least not at first. It’s called giving people the benefit of the doubt but I’ve changed and now try to give myself the benefit of doubting. I’ve become more careful, with a need to research and investigate before making a decision. That’s a good thing. If more of us investigated, asked the hard questions, then I’m sure our win rate would increase.

For someone like me who is optimistic and sees the benefit rather than the risk, balance is necessary. I have that balance in my wife, Julie. Sometimes I think she goes too far to the other extreme, skeptical and pessimistic about everything, and I mean everything, but I need that.

As I begin the investigation phase of my latest What Next venture, I present the positive aspects and Julie shoots them down. She has really good aim. If I can convince her, then I’m sure I’ve thought of everything, looked at every option, and can be confident that we should continue moving forward.

How is your gut? (I’m not asking if you have a six pack or not) Do you adhere to the adage, go with your gut? Let me know in the comments area below.

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Life is like…

Make your own pathI haven’t been hiking in a while and I miss it. My favorite place to hike is the desert. The landscape and scenery is surprisingly diverse. One hike in particular took me from a low elevation scorched by the sun and heat to cooler, higher elevations among evergreen trees and snow. It was an amazing lesson in change and adaptation. Not only did the vegetation change the higher I climbed but so did the wildlife. I also had to change as the clothing I wore at the beginning of the climb, in the heat, would not be sufficient as I continued to a much cooler, even cold climate.

In order to be prepared for the various conditions the hiker must plan ahead bringing the proper clothing, enough food and water to name a few things. Another aspect of preparation is the conditioning that is necessary for longer, more strenuous hikes. Without planning for the change in climate or the difficulty of the hike you are at risk of failure, and failure at such an endeavor can prove fatal.

The hiker must also be honest with themselves and respect their limitations. Each hike builds upon the strength gained in previous excursions as you push a little farther each time. The distances I could go when I began hiking were significantly less than the distances I now travel. The equipment I carried early in my hiking was an indication of my lack of experience and over confidence. The equipment I now carry shows growth in my level of expertise as well as my respect for the endeavor. None of the following were in my pack on early hikes but are now: flashlight, heat blanket, nine volt battery, steel wool, and much more.

All these points have equivalents in life. The landscape of life is diverse indeed with incredibly hot times and very cold times and each of us has to be prepared for that change. People come and go from our lives as we continue on our path but each of them affects the direction we take. In order to be prepared for the different climates, and the difficulty of the journey of life, we have to plan ahead (but most don’t). The more we experience in life the more we can handle, just as a hiker who travels one mile can go two miles on their next trip. In life we need balance. We must be honest with ourselves, willing to admit when we need help but confident enough to test those limits. The packs we carry throughout life become heavier as we add new tools to aid us, but we should scarcely notice as our strength increases as well.

Life is like hiking, not exactly the same, but there are enough similarities that I use the hiking analogy throughout the book. Where will your hike take you?

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