SMS 153 – Financial Vulnerability

Financial Vulnerability Evolves Through Stages of Your Life

Vulnerability: capable of being physically or emotionally wounded.

Signs you might be feeling financially vulnerable:

  1. Anxiety
  2. Fear
  3. Uncertainty about the future
  4. Lack of knowledge

We all seek financial security, however we are all susceptible to financial vulnerability
Real vs. perceived vulnerability throughout our lives.

Financial vulnerability or the elution of it will go up and down but will tend to settle where it always has been, unless you surrender to the delusion of control.

The delusion of control is the believe that we think we can control the outcome of many or even every situation we find ourselves in.

The financial vulnerability cycle
1. Identify financial vulnerably feeling
2. Put safe guard in place
3. Identify new, less damaging vulnerability, but treat it the same as the first one
4. Put safe guard in place
5. Identify new, less damaging vulnerability, but treat it the same as the previous one
6. Put safe guard in place

As you put into place measures and safe guards to minimize the feeling of vulnerability you will then focus on smaller issues seeing them as threats where they were not a threat before and the feeling of vulnerability returns.

Ask yourself this question: Would you have loved to be in the position you are now 5 years ago?

Vulnerability Through Stages of Your Life
Beginning of working career
– education
– Job experience
– workplace skill
– networking connections

Middle years
– additional financial responsibilities
– dependants
– the stakes are higher

End of working career
– higher wage you are less likely to replace
– reduced productivity
– job transition is more difficult

Retirement Years
– Health
– Investment returns

How vulnerability serves you
1. Its not something you should try to defeat, you should embrace it — it’s a built in protection
2. Exposing your vulnerability will show the world who you really are
3. Exposing your vulnerability will show you who you really are
4. If you don’t feel vulnerability you are also shutting down your positive emotions

SMS 152 – Comparing Yourself to Others Financially

Comparing yourself to others Financially

Life is so much simpler when you stop explaining yourself to people and just do what works for you.

Why we tend to compare ourselves to others:
1. Easy (lazy)
2. Societal pressure
3. Envy
4. Our Social Circles
5. Inspiration
6. Predictable outcome
7. Lack of confidence

Why you shouldn’t compare yourself to others:
1. Different resources
2. Different values
3. Different goals
4. Different support system

SMS 151 – A Financial Crutch is Your Enemy

A Crutch is Your Enemy

How and why financial crutches happen

Its ok to reach for help but when rely on it it become a crutch

Toxic Charity: Lessons from Bob Lupton
1. Appreciation
2. Anticipation
3. Expectation
4. Entitlement
5. Dependancy

What is a crutch:
1. Traditional: something to lean on because of an unanticipated event
2. Handout rather than and hand up
3. Limiting believe
4. Doing vs showing – look for teachers in your life
5. Decision making vs philosophies – decisions making is a developed skill

The problem with a crutch:
1. Don’t develop a resourceful toolbox
2. Have to live your life under somebody else rules
3. Guilt – financial and emotional
4. Life direction is limited
5. Limited by the limitations of your crutch – situation/career
6. Enables a false unsustainable reality

SMS 150 – A New Beginning

Build on top of something you have already started or get back to there basics

Our lives tend to be a contagious never ending cycle with a re-sets you need to find a time of year for a fresh start.

New years resolutions are not quite the same because you go from winter to winter where with September brings a change of season and all of your senses are engaged.

Why September represents a new beginning
1. Move from relaxation mode to productive mode
2. End of vacation season – re-start routine
3. Change of seasons – environmental and physical
4. School starts – traditional and continued learning

Areas of life for a new beginning:
1. Relationships
2. Health – physical and mental
3. Finance

How to leverage a new beginning:
1. Enrol in continuing education
2. Remember the frugalness of the student lifestyle
3. Read a self help book (audiobook)
4. Subscribe to a youtube channel
5. Subscribe to a podcast
6. Join a group of like-minded people

SMS 149 – Financial Literacy

Why financial literacy is important
1. Personal finance touches all aspects of your life
2. It will serve you for your entire life
3. Builds self-confidence
4. Develops big picture thinking

Possible target groups – secondary school or post secondary school

Why financial literacy might not work in High School
1. Maturity is not ready (no urgency)
2. Peer pressure
3. Mandatory vs optional
4. Parent are too strong of a role model
5. The stakes are too low

Financial Literacy Topics:
1. 90% behaviour 10% math – develop life long habits and self-discipline
2. Spend less than you earn – a documented budget is a requirement
3. Credit does not solve problems – it makes them worse
4. Life does not always go as planned – and that’s ok
5. Develop the self discipline to save money – and not spend it
6. Document your goals and dreams
7. Develop a value system – this will evolve as your grow

SMS 148 – Personal Finance Advice

Opinions vs. Advice

People who may try to give advice:

  1. Perceived general knowledge experts
  2. Individuals who have been where you are
  3. Individuals who are where you are
  4. Individuals who want to be where you are
  5. Parents – may give advice to be cautious because they don’t want to
    see you fail
  6. Family and friends

How to know you’re being given advice:

  1. You second guess your decisions
  2. You find yourself relying on the input from others
  3. You feel bad about your financial decisions (and let others make
    you feel bad)
  4. You’re indecisive and/or easily swayed
  5. You succumb to keeping up with the Joneses (this plays out in a
    multitude of ways with family, friends etc.)

Reasons to get advice:

  1. Lack of confidence
  2. Lack of experience or knowledge – we convince ourselves that others
    know better when no one knows our situation and goals as well as we do
  3. Not wanting to own our own financial decisions
  4. Don’t have well defined goals
  5. Haven’t developed a value system

SMS 147 – Measuring Financial Progress

Measuring Financial Progress

Whenever you are measuring anything in personal finance never use comparison as a guide.

Reason to measure progress:

  1. Make sure you are moving toward your goals
  2. Stay motivated
  3. Observe cause and effect
  4. Stop chasing a financial horizon

How to measure financial progress:

Hard measurements:

  1. Debt reduction
  2. Savings goals
  3. Income level
  4. Net worth
  5. Financial independence number

Soft measurements:

  1. Financial edge concerns
  2. Reduction in stress
  3. Your goals seem more realistic
  4. Frequency you celebrate wins – read the sign posts
  5. An increase in time spent enjoying life

SMS 145 – A Cost Effective Approach to Technology

A Cost Effective Approach to Technology

The problem with technology:

  1. Product lifecycle – built in obsolesces
  2. Brand ecosystem – ties you to a brand
  3. Peripheral equipment – requires endless accessories
  4. Compatibility issues

Uses of technology:

  1. Entertainment
  2. Convince
  3. Essential – cell phone, GPS
  4. Critical – medical, employment

Approaches to technology:

Early adopter

The Good:

  • You get the latest products – status
  • By working through the issues you become a product expert

The Bad:

  • very expensive products
  • products are in the developmental stage

Mainstream adopter

The Good:

  • You get the latest products – status
  • By working through the issues you become a product expert

The Bad:

  • very expensive products
  • products are in the developmental stage
  • expensive because demand is high

Late adopter

The Good:

  • substantially reduced price
  • fully tested product
  • Second hand market

The Bad:

  • do not get the latest features
  • lifecycle time has elapsed
  • compatibility issues