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The Daily Grind

The Daily Grind

| January 11, 2019

Holiday festivities give way to New Year's resolutions. "New Year, New Me!" Is parroted all over social media as we declare our best intentions and goals for 2019. It's a tale as old as time. We write down our goals, create lists of things we'll stop doing and longer lists of things we will start doing. Less sugar, more sleep, yoga class three times a week, the list goes on and on. This is a good thing by the way. But not easy to stick with.

The next phase begins mid-January when the new workout, diet plan or other self-imposed daily checklist turns into a daily grind. You pictured yourself killing it at the gym. But at 5:30 am, when the alarm goes off and nobody is looking, it's so much easier to hit snooze and reschedule for tomorrow. It's now 9:30 am and you are your desk. Judy from accounting has brought in Girl Scout cookies. You have to buy some or your coworkers will think you hate children and America. On the drive home, the wife calls and asks you to pick up dinner. You see the McDonald's drive through and fantasize about a Happy Meal. It's now 9:30 pm and you're wide awake from the espresso you shouldn't have had at 4:30 pm earlier that day. After lying in bed staring at the ceiling you head to the couch to Netflix and chill.

Two Success Factors
There are two things you can do to shore up your resolves and follow through with your New Year's plan. First, get an accountability partner. Someone who is in the trenches with you. Someone who wants you to succeed but won't let you make silly excuses for hitting the snooze bar. The problem with New Year's resolutions is that two weeks in it gets difficult and nobody is watching. Invite an audience. Consider yourself a professional athlete performing for a crowd. Peer pressure can work both ways.

Second, trust the plan even though it's boring and you don't see results right now. For instance, going on a two mile run every other day for two weeks won't turn you into an Olympic athlete. In fact, you'll probably feel tired, frustrated and bored as your body slowly realizes it's going to have to compensate for higher output and higher strain. Too many times we quit before the body adapts.

And Your Point Is?
Market volatility and economic uncertainty in the fourth quarter of 2018 and the first few days of 2019 can shake us from the plan we set up when we were more optimistic and determined. And yet, these are the times when we must be unwavering in sticking to the plan. It's not easy contributing to an investment plan that has been down in value the last few months. It's a grind to hear the bad news on TV and leave your allocations alone.

The key is that the two factors above apply to both New Year's resolutions and financial planning. First, get an accountability partner. Someone who is in the trenches with you. Someone who wants you to succeed, aligns with your success and will give you a historic perspective on your fear, greed or boredom. This advisor will be alternate as a cheerleader, teacher and therapist. The key is you'll have a person to talk to help you make informed, non-emotional decisions.

Second, trust the plan even though it's boring and you don't see results right now. One questions planners ask clients is about their time horizon for their financial goals. A quarter of economic volatility has perspective when you consider a decade time horizon. In 2017, investors are lured into the siren song of high returns and lower volatility. In 2019, investors are nauseous. Your financial plan should take into account both extremes. Your financial planner provides accountability to manage your expectations in both extremes.

Happy Meals
In the movie, the Founder, we see Ray Kroc build the McDonald's franchise. The film is a love letter to capitalism and one man's grit. A quote from Napoleon Hill's book, Think and Grow Rich, bookends the movie. I'll leave it here to remind you create a plan and persist:

"Nothing in the world can take the place of persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent."

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