Complex Financial Lives Are The Worst

Whatever amount of money you have reflects your previous financial decisions.

We’re making financial decisions constantly.

To invest, save, or spend.

Visa alone processes 6,120,000 transactions every hour of every day.

Almost 75,000,000 Apple shares traded hands this past Thursday.

Needless to say, a lot is going on.

But while it’s easy for me to write that simple sentence about net worth being a collection of decisions, it’s far more complex than that.

Here’s what I want to hammer home this week.

Complex financial lives are the worst.

They are a shortcut to going nowhere. Confusing, disheartening, and the opposite of Tired & Rich.

Our team runs into them and fixes them weekly.

Here’s what this looks like:

“I make $200k. I don’t know where to invest, have no clue about my old 401k that’s sitting out there, I want to take a trip with my kids, I have this extra cash that I don’t know what do to, I think I spend too much money, I hated my student loans and don’t want my kids to have them, and yeah, I think I am going to get laid off. Can you help me?”

That’s complex.

• You know what your 401k is.
• You know you should save 10% of your income.
• You know what’s happening in the stock market (all-time highs!)

The basics are easy but what I said above is normal for a ton of people.

It represents the culmination of years of decisions that have piled together into a complex web of dreams, goals, dislikes, mistakes, and epic wins, a simple financial life that becomes complex.

Before diving into the action step for the week, let’s define financial complexity.

Strong feelings and thoughts about money that someone tries to ignore but still make them feel worried or make bad financial decisions.

Here’s how this works:

1. You want to do something now, then something else three months later, and something else again four months later.
2. You never know exactly what to do.
3. You live in perpetual financial anxiety because of this.
4. You end up winging it and hoping for the best, resulting in too many bad decisions and stagnant financial progress.

I’ve railed against financial complexity for years – it is in every way counterproductive.

It’s a great way to go slow, stay stressed, and not make financial progress.

Financial complexity can strike anyone, too.

Ask a person struggling with homelessness what it’s like not having an address while trying to open a checking account.

On the other end of the spectrum is Warren Buffet, who exemplifies simplicity and its power to turn money into more money.

Here is his financial life

227,416 A Shares of Berkshire Hathaway (BRK.A).

That’s his financial life.

One job, one company, for 65 years.

Pretty incredible.

But you are not homeless, nor Warren Buffett, so what gives?

Here’s the answer:

Your financial life needs to make PERFECT sense to you.

Your investment strategy, financial plan, tax strategy, insurance strategy, budget, and everything else.

You should be able to explain to your spouse or self in two/three sentences how this all works in simple language.

Here’s mine.

I serve my team and clients at Fjell and write to you. I take those profits and invest in the equity markets for my family’s future. My family lives below our means and enjoys being generous with our finances.

It’s taken me ten years to get here, but it’s simple.

Purposely simple.

Our team works with many successful families that have complicated lives.

When a new family comes to Fjell, they come with a garbage bag of “Help me figure this out; I know how much money we have, but I’m not sure where we’re going or what to invest in.”

They dump it on the figurative table and take a deep breath, knowing my team will sort through it and get them to a place of:

“We’ve got this.”

Your financial life may never be as simple as Warren Buffett’s, but it should be simple to understand and execute.

It should produce more passive income and growth and be easy to manage by retirement.

• If your financial life makes no sense to you, that’s bad.
• If you don’t know where you are going, that’s bad.
• If you’ve never seriously put together a financial plan, that’s bad.

You’ve got one life, one career.

Kill the complexity, do the basics, and return to the good life.

I appreciate you.

Thanks for your time.

PS.

You can have a stronger, simpler financial life sooner than you think. When you are ready, reply to this email, and I will connect you with my team.