Knowledge is not power. The application of the right knowledge is power.
There is an old saying that “Knowledge is Power.” But this is only partially correct, and it can be untrue.
Knowledge is not power; it’s the “application” of the right knowledge that is power. Just knowing something isn’t enough.First, you need to know the correct information.
Then, you need to know how to properly implement it.
Next, you need to take action.
And finally, you need to review things on a regular basis over the course of time to ensure things stay on track.
All of this is so true for your money and financial future.
In today’s information age, we’re bombarded with things masquerading as facts from different websites, videos, television, radio, podcasts, updates, emails, and texts — just to name a few. It seems as if every month there is a new form of communication that we somehow had lived without for years, but now we supposedly need it. Consider that prior to 2005, many people had not heard of Facebook, Twitter, LinkedIn, Instagram, or Snapchat. You probably remember a time in the past when we had three channels to choose from on television: ABC, CBS, and NBC. Cable and satellite television weren’t available prior to the 1980s. When my family first got cable television in the 1980s, we had about 12 channels. Today, many people have hundreds of channels — most of which they never watch.
I heard estimates that over 50% of what we read on the internet is not accurate. Whether this estimate is correct can be debated, but I think we can all agree that there is a lot of misinformation online and from other communication sources. We see this when it comes to the so-called financial information that is published online.
“If it’s on the internet, then it must be true” is something that I jokingly have told my clients. Most people get a good laugh from this since we all realize there is a lot of misinformation online.
Let’s say that you do have a lot of knowledge about finances. You’ve done your research by reading various articles on different topics from multiple sources. Some agree with each other, while others disagree. You’ve watched some financial shows on television and perhaps heard some radio broadcasts on the subject. You’ve even attended some live financial educational events. And you’ve compared notes with some trusted family and friends. You have a lot of “knowledge.”
So, my question is: What are you doing with this knowledge?
Knowledge by itself is not power. Remember, it’s the application of the correct knowledge that you benefit from. This is real power.
Do you want to know what the biggest enemy of wealth is? Procrastination.
I have seen firsthand people who could make some simple changes and improvements to their portfolio yet want to “think about it” for a few weeks, which turns into months, which turns into years, and ultimately nothing ever gets done. They are in the exact situation many years in the future, in which they do not have a real financial plan in place, all because of procrastination.
When the stock market has some good years, they certainly make money. But when the market suffers a downturn — as we have seen repeatedly — they lose a large portion of their portfolio, which sets them back. This can have a big impact on their financial future. When a person loses 10% to 40% of their net worth in a short period of time (like in 1–2 years), and they need to withdraw some of this money, this can be like a death spiral for their finances that they might not ever recover.
Thankfully, there are ways to help ensure your financial future!
I offer something called Results in Advance Planning. This is where we look at your current investments that are meeting your goals. We then look at your investments that are not meeting your goals. Next, we’ll look at any investments that you have been considering but have not yet implemented. My firm will perform a “stress test” on your current investments and different potential scenarios in which we will look at historical rates of return, risks, fees, and more. We will compare this to your goals and financial objectives. Then we will see what is on track and working well and what simple changes or tweaks we could make that could have a big impact. This is looking at the results and planning for future results based on the things that are important to you.
It’s important for you to know how all your assets are working together to accomplish your retirement goals — and not somebody else’s. When you have a real plan in place, you’re not as concerned about the direction that the stock market might head next. Many have benefited from having the right mix of money invested in the stock market and another portion of their money invested outside the stock market. This can include insurance strategies that offer guarantees backed by the insurance carrier and no risk of stock market loss — even if the stock market is down by 10% or more in a year. I have also been able to help a number of my clients with setting up additional income sources for retirement. This is money that, when following proper strategies, they will get paid every month for the rest of their life and their spouse’s life — even if they live another 20 or 30 years or beyond. Others want to have the option for income in the future, in case of inflation and rising medical costs. There are so many things that proper planning can do.
Work with a qualified financial professional, educate yourself, look at different options to improve your financial situation, and then make some decisions about the “action” you will take to improve your financial future. Do not procrastinate, as you could likely miss the opportunity which could cost you for the rest of your life.
At the end of the day, you’re probably like most people who want to know that they have a real plan in place so their money is working for them and will last for the rest of their lives. They want to be able to enjoy retirement with their family and friends, do some traveling, enjoy their kids and grandkids, and help the charities that are important to them. They do not want to feel the stress or worry about their investments. They want to know that their money will last for the rest of their lifetime.
This is simple enough. Just be sure to take action and never procrastinate.
For more information or to schedule a meeting, please contact our office.