How Investing Is Like The U.S. Open
How is investing like the U.S. Open? Our national golf championship is a great metaphor for long-term investing. It's not about birdies or eagles. It's about avoiding big mistakes. The best way to make money is to not lose big chunks of it! Having a financial "caddie" on your side can help you tremendously.
Patrick King: it's U.S. Open week. What lessons can we learn from this week's U.S. Open to apply to your investing? Find out coming up.
Hey everybody, I'm Patrick King with Transformative Financial. Here, on this channel, we help people make money, keep money, and feel more financially secure along the way. If that's appealing to you, I'd love to have a conversation to see if it's a good fit or not. My phone number is 404-500- Almost forgot my phone number there- (404) 500-9261. My e-mail is firstname.lastname@example.org.
Today, what does the U.S. Open have to do with your long-term investment strategy? Actually, it has absolutely nothing to do with it. But I am totally going to make a great metaphor out of this whole thing here, so hang with me. It's the U.S. Open week this week. By the time you're watching this, it will certainly be over, and we'll have a new national champion.
If you're a golfer, it's kind of a special time. If you're just a casual golf fan, what's kind of cool about the U.S. Open is that you can watch these amazing pro golfers struggle, just like we do, and make bogeys, and double bogeys, and triple bogeys (and worse) at times. It's a little bit of a different type of tournament. For me, I think it's a great metaphor for long-term investing.
Over the course of the U.S. Open, there's so many -- like the course is just so dang difficult that there is opportunity for these golfers to make a big score on every single hole. The trick for some of these golfers is just to minimize your mistakes. Over the last couple of decades, the winners have been somewhere around par. If you think about it, the winner's been the person who's made the least amount of mistakes over the course of the four days of the tournament.
What does that mean for your investing? I think the parallel to be made is that the best way to make a whole lot of money is to not lose big chunks of it along the way. If you can avoid making those bogeys, and double bogeys, and triple bogeys – to bring the total sports metaphor into this thing – that's the best way to grow your wealth over the long term.
It sounds obvious, it sounds easy, but in practice, it really isn't. Over time there's so many opportunities for the distractions that come in that would pull you off your strategy, like the latest hot stock, private real estate deal that your buddy can get you in on the inside track, an early-stage venture capital deal, Bitcoin, you know, crypto currencies. Although I think we've learned our lesson on that. Hopefully, we've all learned a lesson on that, recently. (I certainly did not espouse any of that, so please don't take that the wrong way.)
You name it, there's all these things that pop up and it seems like a great way to build wealth quickly. But these can be kind of the siren songs that are so alluring, and pull you out of your strategy, and end up blowing up a portion of your portfolio.
They could blow you up just like a triple bogey could blow up your good round of golf. Don't do that!
When you think of investing, do you have a strategy to plot your way around the golf course? Investing is just like a very, very tricky golf course. It's good to have an idea of, "Hey, I want to do this. Hit it here, hit it here, and make it a two-putt." Or, "This is going to be -- five is a good score on this hole." What's your strategy, for the long term, to prevent these distraction investments from pulling you off your strategy?
Then, second, do you have a caddy to manage your game. You look at all these pros, every single one of them has a professional caddy that they work with week to week. Why? Because they need that help. They need that second set of eyes. They need that extra judgment to help them manage their game. To help them club their shots, to help them manage their emotions, keep them from being too greedy, keep them from being too defensive.
That's exactly how a real financial adviser, a fee-only, NAPFA financial adviser, could help you stick to your strategy along the way, and help you manage your round. The stakes are a little bit higher for all of us when it comes to our life savings, and making our savings and investments to do what they need to do to support the life that we want to live.
If you don't have a good caddy, find one. I would love to talk with you if it's a good fit. If I'm not a good fit for you, go to the NAPFA website, I'll post a link down the show notes below. XY Planning Network is also a great place to find a fee-only adviser who can help you club your shots, pick your investments, manage your game, manage your emotions along the way. I love this great clunky sports metaphor this week.
If you watch the US open, I hope you enjoyed it. I'm kind of rooting for Dustin Johnson, my fellow South Carolinian. Thanks for watching. I hope you got something out of this episode, little fun one today. If you like this video, please hit like. Hit subscribe, if you want more videos like this. Until next time, my name's Patrick King with Transformative Financial. Thanks for watching.
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