This week saw the PGA visit Augusta, GA for the Masters, which makes it a great time to share 3 financial lessons that we can take from some of the greatest players in the world.
Mental Toughness – To me the game of golf is such a mental roller coaster, and the masters may be the roller coaster that is the fastest with the highest drops. In golf, even if you are blessed with the skill and possess the discipline to become a great there are shots, holes and even tournaments that do not go the way you imagined them. Investors face similar issues; markets, strategies and investments that simply go a different direction than you had thought they would have. Like great golfers, great investors must have a high level of mental toughness and no matter what you must understand that you will face challenges. In order to perform to their greatest capabilities at the masters each golfer must manage their emotions and mental state over 72 holes, investors do so over a lifetime and to in order for one to build significant wealth you must make quality short-term decisions much like a golfer making a series of shots on a given hole.
Golfers and investors need to deal with the bad, during the tournament you need to put the bad hole behind you and concentrate upon the holes ahead of you. You must learn from the bad hole and apply the lessons you learn to the holes ahead of you, and if something needs to be fixed, stick to fixing one thing at a time because that one change will affect the rest of your swing.
Develop a Strong Foundation – In golf, you need to have a strong foundation in order to play well and investing is no different. Many are blessed to be able to pick up the game of golf and play at a decent level, but if you want to get better you must put in the time to practice and truly understand what your strengths and weaknesses are. The best golfers, especially those at the masters have a coach and we believe that investing is no different. In order to play at your best, you need to understand the game, have a coach that understands you, not just your physical game but your mental game as well.
The skills necessary to be a great golfer and investor take time to learn and the more time you put into getting better, the better your game will be. It often takes years for one to appreciate the journey to becoming great at the work you do, especially in those that are highly successful as they often develop a perfectionist mindset. When you are golfing and investing, enjoy the time and effort it takes to get better, it will get you closer to greatness. You must also learn to celebrate the things you do well, anything that gets you closer to your goal is a done well, even if it only moves you an inch closer to your goal. Life, just like golf is a game of inches.
Play within Yourself – At the masters, golf’s greatest players know that you must not attempt shots that you cannot play, if you do not have the competency to make a shot then do not try it. This is where professionals set themselves apart from the rest of golfers out there. Great golfers understand that there is no need to smash every tee shot or iron shot with every ounce of power you possess. They stroke the ball, ensuring that they play within themselves. Many players struggle with this rule in golf, I will admit that I am among them. You must understand what your capabilities are and play against yourself; at the end of the tournament you will be in a much better position than if you attempt to play better than another player.
When dealing with investments, you need to apply the same rule. Trying to do everything at full power can and will be disastrous. Growth is something that needs to be managed carefully. Often, we hear from investors that they want to invest in something that has made a friend, co-worker or family member money, key word here is made. If you notice it is past tense and your results will be different than the results that they are so excited to share with you. You must invest in things that you understand and investing outside of your capabilities often has consequences, therefore having a great coach in a financial advisor or wealth manager is so important. They can remind you of your goals and capabilities and design a strategy that will allow you to win the financial tournament of life.
What to do next?
It doesn’t matter if you are a masters winner, or just starting to play the game of golf, start with the foundation and enjoy your journey to greatness. If you have questions about applying these lessons to your situation or are ready to start working with a wealth manager that understands the financial tournament of life and has a passion for coaching you to achieve your long-term goals, we are ready to help you. Simply use this link to our calendar to schedule a free consultation where we will discuss your situation, your goals and start developing a strategy to help you achieve them.