In today’s fast-paced world, where we have constant distractions all around us, it’s crucial to pause every once in a while to think about where we are and where we want to go. At Solidarity Wealth, we navigate the complexities of wealth management, but we know it’s not just about growing our assets; it’s about connecting our financial decisions with our deeper life goals, personal values, and the relationships that enrich our lives.
This is something I’ve been thinking about recently after re-watching the late Clay Christensen’s TED Talk from years ago on the same topic. In this blog, I share four of my personal reflections on how we can measure a rich, fulfilling, and purpose-driven life—something I am still personally striving for myself.
Avoid the Dangers of Short-Term Thinking
The temptation of short-term thinking—whether it be with our finances, personal life, or professional aspirations—is filled with immediate rewards and progress. Yet that often leads us in the wrong direction of where we should really be going. This mindset can lead to hasty financial decisions, like pursuing high-return (and very high-risk) investments without proper analysis or overlooking the stability provided by diversification. It can also lead us to purchase a status-symbol car that excites us the first few months but can leave us with a hefty bill we have to pay for years on end. These short-sighted choices may offer immediate gratification but often result in missed opportunities for how we should be allocating our money.
Yet the consequences of short-termism aren’t limited to finances; they spill over into personal life. As humans, we are prone to seek out things that give immediate rewards and achievement. That can lead us to wanting to knock off a few extra tasks at work, while spending less time with our family or friends. We know that relationships are formed over the long run and don’t produce quick, tangible results. But our brains crave the short-term achievement we receive by ticking something off our to-do list at work to feel a sense of accomplishment. While we don’t want to avoid or neglect work, we also want to make sure we’re investing in longer-term activities that are typically more meaningful than anything in the short term.
Know Your Purpose
Aligning your long-term purpose with your daily actions is key to a fulfilling life and successful financial plan. As a wealth manager, I know from experience that helping clients identify these core elements can significantly enhance their wealth management approach. Financial goals then become more than just numbers; they reflect the individual’s life ambitions, aligning investments, savings, and spending with personal values, like funding education, ensuring a comfortable retirement, or contributing both time and money for philanthropic causes.
Purpose is dynamic, though, and will always evolve with personal growth and changing life circumstances. In one season of life, the goal may be to grow a successful business, while in another season, you may want to give away portions of what you’ve earned to charities you admire. Because of our changing desires, it’s important to regularly reassess what our main long-term purpose is so our daily life aligns with our goals. These periods of regular reflection without the distractions of day-to-day life are essential mile-markers to measure what you have meaningfully accomplished and the direction you are headed.
Focus on Relationships
Most of us are aware and intuitively know that relationships with the ones we care about are what is most important and meaningful in life. Yet as I mentioned earlier, at times we neglect those relationships because of urgent, pressing matters at work or elsewhere. While I know that there will always be times when business will necessitate more hours than we’d typically like, we can’t lose sight of the people who mean the most to us. As the late legendary investor, Charlie Munger, has put it, “To the extent that all I’ve done is pick stocks that have gone up and sat on my behind as my family got richer, I haven’t left much contribution to society. I guess it’s a lot like Wall Street. The difference is, I feel ashamed of it. I try to make up for it with philanthropy….”
Like our financial accounts, relationships benefit from long-term investment through regular, meaningful interactions and support. This investment in relationships provides the best type of return, enhancing our overall life satisfaction. While you are working to see your business and career goals become reality, don’t forget to devote your time and resources to the health and happiness of your personal relationships even if you do not see any immediate rewards.
Avoid Marginal Cost Thinking
Avoiding marginal cost thinking is essential in financial planning and personal decision-making. What is marginal cost thinking? The best way to describe it is that it embodies a “just this once” mentality where you can make exceptions to rules that often lead to long-term negative consequences. Think of cheating on your diet or not doing something you’d normally do for a client. If you allow it just this once, it might seem to have a negligible effect, but that’s often not the case.
The approach I follow recognizes the significant impact of small, immediate decisions, and how they can compound over time – just like investments, leading to substantial financial, business, or ethical setbacks. In other words, the small things do add up, and you should avoid cutting corners or making one-time exceptions. It might be a hassle in the moment but will likely lead to long-term satisfaction that you’ve stayed within your vision of how you want to conduct yourself. Moreover, focusing on long-term goals at the expense of short-term shortcuts has been proven time and again to succeed in business and investing.
Crafting a Financial Strategy That Aligns With Your Life’s Vision
If you’re striving to align your financial goals with your personal values and aspirations, a traditional approach to wealth management may not suffice. Your unique journey deserves a strategy that’s tailored to your life’s ambitions and relationships, not just your financial portfolio.
If this type of approach resonates with you, let’s connect. You can email us at info@solidaritywealth.com or call 385-374-1665 to schedule a consultation. We can craft a financial strategy that not only meets your needs but also fulfills your personal vision and strengthens your cherished relationships.
About Jeff
For over a dozen years, Jeff has advised some of the country’s most successful families on all aspects of their wealth. With his background as a former tax and estate planning attorney at a prominent Houston, Texas, law firm, Jeff has advised clients through business sales, funding rounds, IPOs, complex tax and wealth planning transactions, private and public market investments, executive compensation packages, succession planning, and much more. In short, Jeff helps clients navigate the unique challenges that come with building wealth and helps them better predict their financial future.
In addition to co-founding Solidarity Wealth, Jeff advises single-family offices on a broad array of challenges. He also serves as the Managing Partner of Solidarity Capital, an income fund managed separately by the Solidarity partners.
Jeff is a sought-after thought leader on a wide range of tax, finance, and estate planning topics. Jeff has been quoted in Yahoo! Finance and Kiplinger’s, has published in diverse publications from Silicon Slopes magazine to the Taxation of Exempts journal by Thomson Reuters, and has spoken to audiences ranging from the Estate Planning Section of the Utah State Bar to the Nonprofit Organizations Institute to large company conferences.
Jeff holds a bachelor’s degree in accounting from Brigham Young University – Idaho and a Juris Doctor, with honors, from the University of Texas School of Law. Outside of work, Jeff is married and the father of three amazing children. He has also served as past president of the Salt Lake Estate Planning Council.
Solidarity Wealth is a registered investment adviser. This material is solely for informational purposes. Advisory services are only offered to clients or prospective clients where Solidarity Wealth and its representatives are properly licensed or exempt from licensure. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by Solidarity Wealth unless a client service agreement is in place.