Play Your Own Game
Michael Jordan said he had to reconstruct his body when he went from basketball to baseball back to basketball. Baseball favored strong arms and chest; basketball required a leaner figure with a stronger core and legs. Part of the reason Jordan’s basketball return was rusty was because he was still lugging around his baseball arms. “Looking back, I didn’t have enough time to get back to a basketball body,” he said. Click to read the blog post
Thoughts from the Haverford Team
“After reading this blog, I understand the importance for advisors to take the time to get to know each investor and their family’s individualized investment goals and priorities. Similar to how the training regimens for athletes across different sports is different, the same applies for investing. No investor is the same and a universal investment plan will never fully satisfy personal aspirations. There is no right answer to investing; it’s just what makes sense for each individual investor.”
Kasey Alff, Custody Operations Specialist
“What I would tell my sisters, friends, and clients is to find a trusted advisor that understands your goals and is willing to invest the time and energy to help you attain them. I often tell a prospective client to let me earn their trust; anyone will tell you what you they think you want to hear, but living up to those promises takes time, energy, and – most importantly – dedication. Is your advisor earning your trust?”
Melissa Bruner, CTFA, Senior Trust Officer
“I’ve run half marathons in my life and I lift all the time. Morgan Housel compares these two working out styles and my point in saying that I do both is perspective. I believe that it’s great to diversify yourself and investing is no different with constant change and market transformations. Perspective is powerful in investments and it’s crucial to understand an investor’s specific needs and desires. That is how you build longevity and a great business relationship.”
Ryan Voerman, Custody Operations Specialist
Questions to Consider
- Have you ever judged another’s investment plan without knowing their true underlying goals?
- Have you ever lost sight of your own long-term goals in pursuit of a short-term gain?
- Has there ever been a time when you had to be reminded of your true long-term financial goals?
Lots of Overnight Tragedies, No Overnight Miracles
Growth and progress is much more powerful than setback. But setback will always get more attention because of how fast it occurs. Slow progress amid a drumbeat of bad news is the normal state of affairs. It’s not an easy thing to get used to, but it’ll always be with us. Click to read the blog post
Thoughts from the Haverford Team
“This blog offers a great perspective on the concept that good news happens over time, and therefore gets little attention. Bad news happens rather quickly, which tends to put negativity in the spotlight. The important thing to remember is that the value of good news, growth, and progress is much more significant than that of bad news. We’ll always face setbacks, but what defines us is our constant battle to be better than we were yesterday.”
Ashley Murphy, Business Intelligence Analyst
“This makes me think about the book Atomic Habits by James Clear. He believes in continuous improvement – doing something just one percent better each day – so that these small improvements add up to something significant. This is so useful, particularly when it comes to investing. Focus less on the short term volatility and concentrate on long term goals. All the while knowing that the strong foundation you’ve built, combined with committing to add to it incrementally, has the potential to add up to something significant.”
Leanne Rudolph, Director of Trading Operations
“This blog hits home because the past year and a half has been tough for all of us, and I think it’s important to take a step back. Housel makes the point that things that thrive for decades can be ruined in an instant, and that there’s no equivalent going the other way. Progress takes time because there’s always competition along with many other headwinds. This past year, we’ve all dealt with a pandemic for the first, and hopefully last time. A major headwind. It’s important to think about the growth that was made during tough times like these. The major point is that in order to be great, a company or person will always have to endure a variety of different headwinds but it’s how you grow from those headwinds that truly matters in whether you’re successful or not.”
Nolan Carroll, Staff Accountant
Questions to Consider
- Can you think of a time when you wanted to sell your investments based on a few days of negative returns?
- Have you ever felt impatient waiting for an investment strategy to materialize?
- Have you ever needed a reminder from an investment professional to keep your long-term goals top of mind?
Rules in the Textbooks, Guidelines in the Trenches
Rules make for great guidelines when crafting sound investment strategies. From there, each investors’ individual risk tolerance, timeline, life situation, and goals must be factored in. When setting a financial plan, these factors can help you evaluate and even bend the rules in pursuit of YOUR definition of success. Click to read the blog post
Thoughts from the Haverford Team
“One size does not fit all. When it comes to investing, you need to listen to clients and hear what they’re saying. Every client’s situation is different and investing is personal.”
Kim Southmayd, Senior Investment Officer
“This post is a great reminder that the world is complex, and although data helps us understand it better, it’s often necessary to read beyond the headlines to fully appreciate the nuance. This is particularly important in a digital world where the content we most often encounter has been filtered down to reinforce our own preexisting opinions.”
Josh Giacalone, Corporate Sustainability Analyst
“Rules imply a binary choice; to follow or not follow them. Important decisions are rarely a binary choice. By using rules as guide, you make a conscious choice to understand every facet and every angle of the situation you find yourself in to make the decision that suits you best.”
Jim Lyons, Vice President & Director of Software Engineering
Questions to Consider
- Can you think of a time when it made sense to deviate from the norm?
- Which investing rules apply to your financial journey? Which do not?
- Can you think of a time when a financial professional counseled you to break a commonly followed rule?
Risk Is What You Don’t See
Morgan discusses the importance of giving yourself a wide berth. If you think a recession will reduce your wealth by 20%, design your allocation to be able to withstand a decline of 40% or more, realizing the powerful recession you aren’t thinking about will be more impactful than the one you envision. Click here to read the blog post
Thoughts from the Haverford Team
“We often lose sight of the severity of risk. We learn to save for a rainy day, rather than a rainy season that could potentially occur. We won’t always have the opportunity to brace ourselves for impact, so we should always take extra precautions just in case.”
Karla Jean-Baptiste, J.D., Compliance Associate
“This past year has been an overwhelming reminder that surprises can happen at any time and we should always be prepared. Planning for unexpected risks can be a nerve wracking exercise, but it shouldn’t be that way. We plan for unexpected risks through insurance, the way we eat, and the tiny decisions we make in our daily lives. Just because we want to anticipate potential environmental, political, economic, or health hazards does not mean we need to build a doomsday shelter. It does mean we should plan ahead and think about our short term needs and our long term goals to make sure we are prepared for almost any outcome while still taking advantage of positive forces. Risk can mean a million different things to a million different people. Some people are risk averse in their daily lives while others jump out of planes for fun. It is important to recognize your tolerance for risk may skew how you plan for surprise risks!”
Kyle Colburn, Financial Planning Associate
“What I really like about the blog and Chapter 17 titled Surprise is that it puts together two very important concepts for successful investing—surprise and preparation. Surprise is inevitable, and by definition unpredictable, in both kind and timing. Houdini, the greatest magician/escape artist ever, never expected to be punched in the gut so hard by a stranger–he could not, and did not anticipate the surprise that caused his death. However, with preparation, the effects of a negative surprise can be mitigated. If Houdini had been able to prepare for the blow to his belly, he likely would have withstood it as he had on many other occasions—maybe with just a bruised belly. So, too, we can prepare ourselves financially to withstand a large, unexpected blow so that we end up with a financial “bruise” that is temporary and will heal and that does not permanently threaten our future.”
Judy Stein, Esq., Trust Counsel
Questions to Consider
- Can you think of a time when an unexpected event impacted your portfolio?
- Which risks can you see? Are you prepared for them?
- Can you think of a time when a financial professional counseled you to think about a risk you hadn’t considered?
