I don't know of any other activity that has as many rules as golf. The Ancient R&A (the Founding Fathers of golf) foresaw each and every possible situation that one might find themselves in during the course (pun intended) of the game and created a rule for it. Not unlike the Founding Fathers of our great constitution, their insight to predict virtually every incident one might encounter on the golf course and come up for a rule on it amazes me. This month, I'd like to focus in on one of those tenets: that golf is defined as a gentlemen's game. Ladies- whatever the Webster-defined equivalent to gentlemen is, this applies to you as well. Considering how well I've seen some of our female members play, I'd be a fool not point that out!
So you ask yourself (or me) ... what does golf have to do with finances? Aside from a weekly bet or Nassau... plenty. It's the honor part that I'd like to associate with this month- how honorable are you with your finances, savings structure, money management and money habits? Do you set rules and strictly adhere to them, not unlike the rules of golf? Have you set your goals within reason, and set out a game plan to achieve them? Are you honest with yourself when it comes to a crossroad between the wants of life vs. the needs of life? How often do you review your plan and make changes when necessary? Do you work with a seasoned advisor to help you get to where you want to go? Is this damning heat going to ever let up? Let's dig a little...
Not unlike golf, the adage in finances "rules were made to be broken" don't work. In golf, you get a few strokes added on, or lose the hole. In life, you don't get another 30 or 40 years to mulligan it out. Therefore, a plan is of utmost importance since there's not enough time to start again- at least, not in this lifetime. I've met with people who are highly organized, review their plan on a periodic basis, and make the changes necessary to achieve their goals. On the other hand, I meet with many more who made their 401(k) allocation years or decades ago, never to be reviewed or changed again. Don't open their monthly statement for lack of interest or fear. Don't know how much to put away monthly, so they pick a number and stick with it. Get a raise... do you raise your contribution accordingly? Nope. See, the thing about retirement planning and general saving is it's like a road trip. If you don't know where you're going, you'll never get there. If you don't have an idea how much you'll need at a certain time in your life, how will you know how much to put away from each paycheck? It's a dangerous game to play- you can't go back 10 years and make up those contributions- the alternative is to work until the day you die, or work will kill you- either way, not the golden years dream you planned on. It's not just about retirement planning- it could be about a saving for a second home, kids' wedding, college, or any goal you choose.
So, it all comes down to how honorable you are with yourself. You may have to pass up the impulse buy or play with the same clubs for another season to avoid upsetting your plan. The key here is to be honorable with yourself, admit when or if you've made a mistake, and take responsibility- or credit- for it. The old saying "honestly is the best policy" is so applicable to finances as well as golf. And now, honestly, I've spent enough time sitting at this desk working away- it's time for a break. "See you on the tee!"
