by Brian Dudley, CFP®️, Founder + CEO
Wooshhh, don’t start yelling at me, Brian!
Look, I’ve made these mistakes at times, too. But I do know that if you make these mistakes early, you’ll end up in a tough financial spot down the road. How do we know if our focus is emerging wealth?
New school thought. Without being new to the game.
My business at Pinnacle Private Wealth (our affiliated registered investment advisory firm) is focused on retirement planning. I’ve seen a lot of people who wait until retirement is near to start planning for their next phase. In some cases, it’s almost too late and it’s usually because they did not avoid one or all of the mistakes I’m about to outline below. Luckily, there are even last-minute steps that we can take to help you retire when you want. However, it may require a move from your lifelong home that you love or to stop spending on the things you are accustomed to having in your life. Who wants that? Let’s avoid that.
Oh, and here’s the great news. You’re young, have a ton of years in you to earn income, and have a relentless pursuit of growth which most likely means you’ll be in some magazine for being awesome at some point in the near future (this may not happen, but you get it).
Now let’s get to those three mistakes you should avoid.
Don’t count your money before you actually make your money.
I’m not gonna lie, I did this early in my career and wish I didn’t. I’d have a few good meetings with prospects and would be so sure that they would close that I could bank on adding to my income. Well, sometimes less money actually came under management or sometimes clients hesitated for personal reasons or sometimes it just ain’t your day. Boohoo. But if you count it before it actually counts, that means you probably spent it. You’re either adding debt or lowering reserves or losing the money you’d otherwise have to invest and work for you. I’ve heard countless stories where jobs are lost, expected bonuses are reduced or are wiped out. Maybe that big sale falls through at the last moment. Whatever the situation, the key is to spend, save, and invest funds you actually have and not funds you think may be coming in.
Don’t watch or follow people and worry why you’re not there.
I love TV. Everyone who knows me knows that. Family, finance (reading and podcasts), music, tv, sports, and food and not in that order, other than family as number one. One of the shows I watch is Ballers on HBO. Lil Wayne’s ‘Right Above It’ blasting at the start. The Rock donning custom suits and driving the latest and greatest all while living that life. You know, that life. Well, that’s not real life (for most). Neither are any of the other shows which show perfect outfits and unlimited budgets. Oh, by the way, neither is that oh-so-perfect life your friends on social media showcase. People try to emulate others all of the time, whether it’s a movie or movie stars, or the latest Insta influencer (sad, but true). Remember, it’s fictional in most cases. Reality is muddy at times; embrace it! You do you and worry about how to become the best version of you. You’ll get to where you want to be faster if you’re genuine and true to your current status. This can be applied to spending, or overspending, but also to life. You choose how best this advice fits into your world.
Don’t count other people’s money.
Similar to the last common mistake made, but this one is closer to home. It’s about your family, your friends, your neighbors, the other parents at your kid’s school, etc. The list goes on and on. I can tell you one thing I know for a fact. Unless you are their personal financial manager, you have no idea what others have, so stop trying to speculate. Worrying about other people’s money can leave you paralyzed when doing your own planning. It may also cause overspending due to trying to keep up with the Joneses. They might have debt you don’t know about. They might lease that fancy car you adore. That home might have been purchased with funds from a family trust. Orrrrrr. Orrrrr. They ball out and deserve it all plus more. What does it matter to your life? You worrying about what they have won’t help you. Maybe it will motivate you to work harder, but what others have placed no bearing on you. Again, worrying about others’ money and trying to keep up with them can lead to doing things that can financially hurt you in the long run— and can cause a lot of undue stress.
If you avoid these mistakes, the chances are you’ll be in a better financial position in the future. You’ll also be happier. What can beat that?
If you have questions or want to start a discussion on your finances, do not hesitate to book a meeting via Calendly on our site, email, call or DM me on social.
As always, I appreciate your time.