Personal Finance – Caffeinated

Jolting For More Jingle Jangle

Simplicity January 14, 2010

Filed under: Uncategorized — coffeecents @ 3:03 pm

A lesson of NFL football is that very complicated plays that take a long time to set up can just as easily break down if your offensive line lets the defenders through and they sack your quarterback.

Now, how to relate that to personal finance.

“You” are the quarterback.  “Being Sacked” relates to failing at some financial goal (pay debt, save up, etc).  The plays are our financial plans.

They can be:

Simple

1) Save 1000 dollars for an emergency fund by automatically adding 50 bucks to the account every pay period for 20 weeks.

or Complicated

2) Be a Millionaire by the time that I am 40.  To do this, go to college, get a high paying job, choose stocks, watch them, trade them, work a second job (should I go out on a date, its 20 bucks?), choose all my investments and amounts … (it goes on)

What’s more likely to work, in the long run? The simple.  To go back to the NFL terminology, it’s akin to calling the most basic of routes (Run it up the Middle, or Pass to receivers running a curl or slant.  No stutter steps, no loop de loops, no picks, nothing).

One the points Coffeecents will emphasis is that a good financial plan is quite simple.  The goal is clearly defined.  There is a clear path to get there.  And the steps to get there are minimized.  It’s easier to get motivated when you aren’t looking at a mountain.

Last night, we (my wife and I) went out to swing dance, signing up for 8 weeks of advanced lessons.  My wife had a motivational problem at first because she saw it as 8 weeks of driving and dealing with cold weather.  She got over her motivational hump by focusing on week 1.  And since we’re now signed up and paid in full, we’re committed to the rest.  By simplifying her goal (Go to Class 1), she (and I) accomplished that goal, and now further goals are more likely (like go to Class 2)

Advertisements
 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s