Financially Speaking Podcast

With Age Comes Wisdom

Published on August 8, 2012

A few weeks ago I was sitting on the beach with my family, enjoying a few days away from the office.  Something about the sound of ocean waves and sand between my toes caused my thinking to become broader than usual.  I thought about the fact that thirty years ago this month, I started my business. 

Back then, I just put my head down and worked as hard and as much as I could.  I was driven by the fear of failure and that I my life’s dream wouldn’t work out.  Eventually, it became more evident that this would be my job for a lifetime.  But I wanted to get better.  I wanted to get more knowledge and information to make good recommendations to my clients. 

I remember hearing that my competition was a big company with lots of smart people; and the company had been around for a hundred years.  I had to convince new clients that my hard work, dedication and knowledge made me a better choice than those big financial institutions.  What I discovered was that I had cultivated a philosophy and methodology that I truly believed in.  At some point in those thirty years, my experience became a factor.  After a time, I had experienced numerous highs and lows of the stock market.  I became better at staying committed to my belief system.  The changes and evolution of the financial markets and systems are phenomenal.  But basically I am doing the same things as I was doing thirty years ago.  Sure my tools are different, but what I do for you is the essentially same -- but better.

The second thought I had on the beach was about being older.  I guess those thoughts were triggered by my birthday in July and by a recent article Smithsonian magazine. It seems that studies are finding that as we age the mind gets sharper at vitally important abilities.  A University of Illinois study concluded that despite some loss in short-term memory, older air traffic controllers excelled at their jobs.  They were expert in managing multiple aircraft and avoiding collisions.  Other studies indicate that managing emotions is a skill and takes many of us decades to master.  The implication is that the older we get, the better we manage our emotions, which helps us manage stress and life decisions better.

Three of those days on the beach, the stock market went down over 100 points each day.  My emotional reaction was nil.  Maybe it was the ocean waves and sandy beach.  Maybe it was my thirty years of seeing this same thing over and over again, only to recover.  Maybe it is the longer I work, the more I clearly I see my philosophy and what I believe in.

By the time I loaded our bags into the car to head home, the market had recovered all it losses and added some.  Some investors lost money that week -- the ones who sold after three days.  And I thought about those who don’t have the wisdom to stay invested. 

Tags: investment decisions; investor behavior

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