Balance, Horses, and Your Money
My financial coaching work often reminds me of horseback riding and the overwhelming need for – and difficulty of – balancing. An overcorrection can land you on the ground with your face in manure. (Don’t ask me how I know that.) It’s not too difficult to balance when the horse is lumbering along, but if he picks up any sort of speed at all, we find ourselves trying to desperately find that middle point between right and left. Things get really interesting when the horse jumps or walks on an embankment. Then our balance is not only required between right and left, but we struggle to find the midpoint on the forward/backward plane as well. Some of us decide to ditch our pride and cling to the horse’s mane for some stability. It ain’t pretty but it does the job.
What does horseback riding and my inadequate sense of balance have to do with your money? Plenty. Your money mindset needs to be balanced with just the right amounts of engagement and detachment.
At One End of the Spectrum – Engage
As women, we have a lot of duties to balance. Sometimes even the really “important” financial duties on our to do lists get bested by all the “urgent/crisis” duties. With everything we have to do in this world, it would be nice to ignore our finances and let them take care of themselves.
It is tempting to simply put all our purchases on credit cards and worry about paying them off later when we make more money. But that doesn’t end well. Our money’s natural state is chaos, it doesn’t become productive unless you are in the lead. You can’t be a follower of money very long because after a while, there is no money to follow. In ages past, money was simpler and a hands-off approach might have worked. But that is no longer the case as our consumption-oriented society paves a more intricate financial roadway.
Another method of ignoring our finances can be achieved by handing the money concerns off to a family member or spouse. Of course, this only works as long as that relationship and the money handler are healthy. As many widows and divorcees are learning the hard way, if something happens to that trusted soul, you will find yourself trying to navigate a complicated system without any guidance. Of course, it is possible – and even wise – to hire someone to handle your finances for you, but it requires at least an initial engagement from you to find the right advisor and a commitment to continued communication.
At the Other End – Detach
To put it succinctly: don’t obsess over your money. I will admit to having the tendency to … let’s just say … overengage. I have learned to edit the manifestations of my core personality, because otherwise I will go all-in (putting my sanity in jeopardy.) My default is to analyze the situation and find the best course of action and think about how to improve my strategy as I try – probably in vain – to fall to sleep at night. (“Hi, my name is Candice, and I’m a recovering perfectionist.”) Some people have parlayed this tendency into successful careers as day-traders. These investment professionals check their investments throughout the day in order to react to incremental changes in the market. But studies have shown that day-traders don’t necessarily make more money than those who decide upon a sound strategy and then hold it regardless of market movements.
In the real world, it’s important we don’t become obsessed with checking our portfolios every week, or even every month. Yes, we need to know what we have, but watching stock tickers on the news may lead you to question your sound buy-and-hold strategy. We do better to know what our long-term returns need to be and focus our efforts on bringing new money into our lives and our portfolios.
If it’s your bank account balance you are checking daily, let me just offer these now-famous words from Kimberly “Sweet Brown” Wilkins, “Ain’t nobody got time for that!” (Click here for the 3-second version or click here to watch her interview on The View.) The better idea is to create some padding – or deposit a little bit of extra money – in your bank account so you can check it less often without fear of an overdraft.
Better still, automate your financial tasks to increase the predictability of your outflows. I use First Step Cash Management for myself and my clients. After carefully determining our weekly needs, this system provides the structure to eliminate unexpected charges. That way you can easily go a week without having to check your bank balance.
As with most things in life, balance in your money mindset will propel you toward greater financial wellness. You’ll make progress if you can just stay on top of that horse.
