UlTImATE SUccESS GUIdEFirst, a real life Goofus and Gallant illustration.
I had a client named Jack come into my office several years back. It
was 2005 to be exact. Jack was gloating about all the money he stood to
make in buying up houses in Phoenix, AZ. He already had successes in
the real estate market to prove his point. We all know a Jack. Jack took
every dollar he could muster up and bought real estate. Where possible
he leveraged with 120% financing. Need I go on? You know the rest
of the story. In 2012 Jack had already been through foreclosures, short
sales, and is considering bankruptcy. Jack was enticed by greed and fast
money. He was looking for the short cut to striking it rich in his invest-
ments. Unfortunately, his savings had been obliterated by investing like
a Goofus.
Contrast Jack’s approach to another client of mine, Bob and Mary. Bob
and Mary had always followed the slow and steady approach in their in-
vesting. Their focus is always first and foremost on capital preservation.
Sure it is kind of boring, and they often miss the big gains from run-ups
in the stock market by not going “all in” when the market looks hot.
Nonetheless they maintain a much more prudent approach to investing.
A slow and steady approach, they never commit too many eggs to a
high-risk basket. They enjoy a financial stress-free life and are able to
live comfortably. They invest like a Gallant.
So let’s explore the Nine Golden Rules to successful retirement plan-
ning. Things Gallant would do.
- sloW AnD steADY InvestMent PlAns WIn the RACe
Like the concept of compound interest, a consistent, slow, bor-
ing approach to growing your investments usually works out
best in the long run. - hAve CleAR oBJeCtIves oF WhAt It Is YoU WAnt
How can you know if your financial plan is moving you closer
to your goals if you can’t clearly define those goals? Take a
look at what you are invested in today. If it is not clear exactly
how those investments are moving you towards meeting your
objectives, dump them and reinvest accordingly.