Flawed
We all have flaws.
All of us.
The problem is that not all of us are aware of our flaws. We are hyper-aware of the flaws of those around us but often blind to our own blemishes.
As the Ancient Greek maxim states, “Know thyself.”
This is, of course, not news to you – I am well aware of that. I know that you know that we all have our own flaws. Here’s what I’d like to discuss today though: are we (1) aware of our personal blemishes? and (2) do we have a plan for addressing those shortcomings?
Lunch With a Friend
I was recently at lunch with a friend, and we were talking about life, goals, career aspirations and the like.
He asked me for advice. He wanted candor, and he wanted a friend to call out his blind spots. These are difficult conversations, but they are good conversations; these are fruitful conversations.
I highlighted a few items for him to ponder, and I encouraged him not to discount these struggles to the environment he’s in. We, as humans, have a tendency to minimize or excuse away our flaws. We blame others, we blame the environment, and we falsely believe that repositioning ourselves into a new environment will solve the issue – a new job, a new city, a new relationship, etc.
Here’s the reality: our flaws are like fleas; they follow us until we choose to address them. I encouraged my friend that it wasn’t his boss or his work environment, he didn’t draw the short straw, and it wasn’t bad luck. He had some work to do, and if he was willing to (1) own those flaws and (2) game plan to address them, the benefits would yield throughout his entire life.
Life, Finances, etc.
The dialogue above is general. These are truths that apply to many facets of our life. Finances are not excluded.
Our financial lives are full of themes, some good and some bad. We should be introspective and identify those thematic flaws. We need awareness, accountability, and structure to protect ourselves from… ourselves essentially.
Let’s dive into three common thematic flaws I see in investors. Let’s take a look at The Babe Ruth, The Mrs. Kravitz, and The Mr. Magoo.
The Sultan of Swat
I love that scene in Sandlot where they realize Smalls doesn’t know who Babe Ruth is.
One by one, they berate him, “The Sultan of Swat! The King of Crash! The Colossus of Clout! The Colossus of Clout! BABE RUTH! THE GREAT BAMBINO!”
One of the most notable sluggers of all time, Babe Ruth. His signature pose? Pointing to the fences with his bat.
Some investors take the posture of Babe Ruth – always pointing for the fences – but these same investors lack the accompanying skill set of a Babe Ruth (or a Warren Buffett).
This flaw is not picky; it preys on investors from all socioeconomic backgrounds. From the veteran medical doctor to the poor college student. These flawed investors are just constantly looking for home runs. They’ve never seen a risk they weren’t interested in tasting. They have tunnel vision for the big hits and rarely track their batting average.
Is this you? How often are you trying to shoot the moon? I’ve seen this Babe Ruth flaw many times, and it might be the most detrimental of all.
These Babe Ruth’s need a coach. They need a second pair of eyes; they need a guide to keep them on track. Financial plans don’t depend on grand slams; they depend on consistency, simply getting on base.
The Nosey Neighbor
Samantha, your friendly neighborhood witch, caught the attention and love of those Bewitched viewers in the 1960’s, but it was Mrs. Kravitz who was so familiar to all of us. We’ve all had that nosey neighbor, and Mrs. Kravitz fit that bill to a T.
I’ll tell you this, there are too many Mrs. Kravitz investors out there. They care more about what their neighbor’s returns and strategies are than their own portfolio. They are captivated by the results and actions of others, which ultimately distracts them from their own plan.
Let me keep it simple – what your neighbor does, did, or said they do or did has no bearing on your plan. Keep your eyes on your own test. Investing is hard enough; don’t make it even harder by rubber-necking constantly.
Is this you? Do you have the Mrs. Kravitz flaw? Again, being aware is half the battle. Own it and address it. Heed the wisdom of your advisor when they seek to help you pivot and refocus on your own matters.
Stumbling Along
Ignorance is not bliss. Ignorance is the result of a lack of engagement, interest, and responsibility. These are your monies, your responsibility. Thinking you can simply Magoo your way through life financially is just irresponsible.
How many people out there have no plan? No roadmap? Yet, they are taking action, making moves, and basically walking blindly. These are Mr. Magoo investors – all action, no plan.
Magoo’s are eager to do and hesitant to plan. They make excuses – too busy, not priority, I will get to it later, etc. The worst part is that they also feel divorced from their failures and are quick to shift the blame to their circumstances – the market, the advisor, or simply just plain old unlucky.
Don’t be a Magoo. It’s okay to come up short, but come up short of an objective/goal that you laid out. Learn from your mistakes, pivot as needed, and strive to grow as an investor/planner.
And the List Goes On…
The Bambi – like a deer caught in the headlights – is paralyzed by fear and never takes action.
The Chicken Little – always quick to panic, quick to float a conspiracy, and often falsely assessing the cause of outcomes.
The Over-thinker – dedicating an abnormal amount of attention to an abnormally small investing/planning issue.
The Sugar Daddy – living beyond his or her means and a plan that isn’t limited by income but rather growing uncontrolled spending.
And I could go on.
What’s important, though, is that you know your flaws. You must know your vices, declare it as an issue, and build a game plan to address that hurdle.
Know thyself. Be introspective. Choose growth.
Simply invite a trusted person into your space – your headspace, your finances, your failures, and your aspirations. Once that friend/advice-giver is familiar with who you are and what makes you tick, then ask them about those flaws/blemishes/blind spots/shortcomings. Wrestle with those, challenge them as needed, and get to a place where you can own those flaws and seek to address them.
Don’t get stuck; don’t be stubborn. We can always grow. The capacity exists. It’s just the willingness that can be lacking.
Past Behavior
An old boss was teaching me how to interview candidates, and I will never forget this one-liner that he drilled into my head, “Past behavior is the best predictor of future behavior.” This is both simple and true.
Do you want to become a better investor? Study the game film, look for the themes, and identify the roots of that past behavior.
Because if you don’t, then those pesky issues will continue to cause the same damage and drama throughout your life.
