Your Do over Guide: What Would You Do Differently?
| November 9, 2011 | Posted by Roshawn Watson under Uncategorized |
By: Roshawn Watson
I don’t truly understand people who say they wouldn’t change a thing in their lives if they could. While I have nothing against contentment, if given the opportunity, I would change several things not because I hate my life but to get the most out of it. If you could press rewind on your life, what would you do differently?
Start Businesses
First, I would have started businesses and have done so early. Nowadays, the barriers of entry into many businesses are lower, including smaller capital and infrastructure requirements. The advantages to owning your own business include: a) your business can be created around your passion, b) you can concentrate your efforts in your chosen areas of competence, c) you would control it and d) you would have tremendous income potential. Indeed, business owners are also five more likely to become millionaires over traditional employees, partly because the financial responsibilities of business operators corresponding well to running an economically productive household including: keeping cash reserves, decreasing unnecessary expenditures, investing for growth, watching revenues and projections, etc.
Of course, there are inherent risks too, but I would rather manage risks over eliminating them entirely. Avoiding risk altogether can be dangerous too. I additionally challenge you to redefine how you consider risk. Rabbi Daniel Lapin argues that we are all in business for ourselves. For example, if you have a traditional JOB, then you are selling your skills, services, time, and knowledge to one customer (your employer). If you are a traditional business owner, you simply endeavor to have more than one customer. This begs the question if it is riskier to have one customer (your employer) or 200 or more?
Adding a side business to your portfolio could literally revolutionize your life. For instance, one kid who grew up very poor decided to create his own video games, since his parents couldn’t afford to them. His classmates saw him playing his games, liked them, so he began to sell them copies (and then their friends). Companies took notice and had him consult on projects before he even reached puberty. Although he was being paid well, he knew that he was worth more, so he started his own company and later sold it. He first retired at 19. Then, he got bored started another business that he also sold and retired again. At the time I heard his story, he sat as a chairman of the board of directors of a publicly traded company, was a well-connected venture capitalist, and traveled the world with his team helping people replicate his success, at the ripe old age of 28!
What potential do you allow to lie dormant?
Quit More Often and More Quickly
In The Dip, Seth Godin challenged the mantra that “winners never quit, and quitters never win.” He argued that winners actually quit frequently and quit swiftly. In other words, winners find what doesn’t work and move on fast. This agrees with advice I heard 15 years ago from a businessman worth nearly a billion dollars. During the conference, he indicated that one of the most important lessons he learned was to “not kid himself. Knowing is half the battle because you can take corrective actions whereas continuing in blissful ignorance sets you up for failure.
My do over would be realizing when I am getting off course faster and to channel all my resources into moving in the right direction.
Investing Earlier and Investing More Aggressively
Does saving and investing 50-80% of your income seem reasonable to you? For most people, the answer is no. However, suppose someone showed you that if you did this for a mere 7 years, you could then retire. I thought that would get your attention. Personal finance expert Dave Ramsey always says “when you live like no one else, you can live like no one else.”
Earlier this year, I asked a simple question “How would you retire in 10 years?” The purpose of the question was to challenge the assumption that it takes a working lifetime to invest adequately for retirement. There are people who never expand their mental contexts beyond that life script who get very traditional results: they slowly build wealth, depend on social insecurity, and may have to choose between paying for some expensive medication or food. This isn’t trivial, it’s a sad reality for far too many people. Investing aggressively and early a) gives your investments a longer time to grow, b) means your source of provision is not dependent on your job, and c) expands your opportunities to reach your potential with limited financial concerns. I challenge you to be the architect of your own life. Don’t allow the complacency of good to rob you of the glory of great!
My do over would be not to allow any slack… fire on all cylinders until I was “done!”
Invest In Myself
If you are frugal (wanting to get the value for your money), it’s possible that you will agonize over things that are good for you. There are several opportunities to advance your career and improve yourself: conferences, seminars, short courses, webinars, certifications, books, but not all of them you will be free or paid for by your employer. I believe there should be at least some room in your budget to invest in yourself.
An author and entrepreneur was recently asked if he regretted wasting money on products and conferences that ultimately provided him little value. For context, he spends an unconscionable amount on educational materials each year: some are several thousands apiece. His answer was a) very few provide absolutely no value (there’s almost always something to pull away from them) b) for ever dud or two, there’s one that helps him completely knock the ball out of the park to the degree that it more than compensates for the costs of duds.
Ask yourself if you are playing it too safe with respect to investing in YOU, Inc.
Avoid Debt
We have a culture of debt: debt is the most aggressively marketed financial product. Entire industries are developed to make us think that we cannot function without debt. However, the borrower is servant to the lender. Sadly, the debtor has obligated tomorrow’s prosperity and limited his ability to build wealth, at least wealth for himself, compared to his contemporaries making the same amount without the debt. For example, if you avoided car notes altogether and invested average car payment instead from age 25-65, you would have an estimated $2,000,000.
Instead, we label debt to make it more palatable by creating trivial hierarchies of debt with all sorts of eloquent rationalizations. Sometimes this involves classifying debts as “good” or “acceptable” or an “investment.” The truth is consumer debt is consumer debt. If you are truly borrowing to invest, I hope your return is substantial, given the amount of risk you are assuming by having debt. Remember, if you have to rename the debt to overcome your misgivings, that may tell you all you need to know right there.
Early on, I would have avoided it like the plague that it is.
Carry Adequate Insurance for Key Items While Avoiding The Rest
It is often said that there is no other expense that people spend so much of their money on without understanding. No one likes insurance until they need it. We all know that insurance companies do not lose money on insurance policies. For every few people who pay a few dollars in premiums and make a big claim, you can bet they have thousands more who pay premiums and have absolutely nothing bad happen to them.
Since you can’t be certain that you won’t be the “unfortunately few” who need insurance, you should judiciously use insurance policies to transfer risks in key areas. After learning this, my whole perspective changed. For example, many people are surprised that I don’t carry an insurance policy on my cellphone. However, cell phone insurance policies tend to be pure profit for the phone companies. My bet is if I replace my phone every 2 years (or so) and make sure that I get a phone that is highly rated, I do not need to pay an extra $120/contract for insurance given: a) the phone’s under warranty anyway, b) I’m not very rough (and don’t lose) my phone, c) and I could cover the cost of another phone within my budget. I also do the same thing for extended warranties (functionally they are insurance): did you know that they often represent a 50% margin, which is almost pure profit. Consider, how much could be saved by carefully analyzing our insurance needs.
My do over would be maintaining adequate coverage for the sensible things at all times and avoiding all others like the financial drains they are.
Is The Struggle Necessary?
Pain is definitely a teacher. It signals that something is wrong, so problems don’t persist undetected. However, learning from pain is also slow and unpleasant. If I was designing my life, I would obtain pearls of wisdom from others experiences via mentorship over learning from my own mistakes. Personally, I would rather someone tell me how dangerous it is to ride without seat belts than learn from first-hand experience.
Well, yesterday is over, and tomorrow is not yet here. However, if you could press rewind on your life, what would you do differently?
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Copyright 2012, Roshawn Watson, Pharm.D., Ph.D. All Rights Reserved.
Thanks for opening up and sharing your regrets Roshawn. The honesty is very refreshing.
You make some good points. Some of those things would have been good to start for you.
For me, I wish I managed my money better as a young adult. I had a bad spot in my life which made me really emotionally unstable and I ended up spending more than I should have. I could have gotten ahead financially but instead I got really behind. I have learned a lot though so not all is lost.
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Thanks for sharing Shawn. I have tons of regrets, but I try not to dwell on them. I like the quit early and often advice. That's different than the usual work hard and you'll be successful and I think more applicable in today's economy.
We've done ok, but probably should not have purchased a residence in 2007. Other than that, things could have been worse.
My recent post October 2011 Cash Flow
You make a great point about debt. Learn to avoid it early and you've already won half the battle.
My recent post Confessions of a Lazy Blogger
Yeah, I'm ridiculous grateful for my life. I'm glad I got my act together when I left undergrad, but I cringe when I think about how I meandered financially
I'm happy that you don't "dwell" on the bad stuff. It's not that healthy. Occasional reflection can be instructive though 🙂
My recent post Your Do over Guide: What Would You Do Differently?
Absolutely. I am so happy I got out debt and have stayed out. It doesn't take much to have phenomenal results over time 🙂
My recent post Your Do over Guide: What Would You Do Differently?
I am one of those people you may not understand! I have no regrets! I would not change things. I am fortunate enough to have done everything I wanted to do. If I make changes there is a danger that it may not turn out as well.
My recent post How Will You Measure Your Life?
I knew you were coming; let me clarify, I didn't know who would take this viewpoint, but it is certainly prevalent enough that I knew some would.
First, let me acknowledge, I have no problem with your perspective at all EXCEPT it is not for me. Your point of view completely challenges everything that I stand for, and that’s alright. I am just always looking for how to do things better. This doesn't mean that I live in yesterday. To the contrary, I’m focused on tomorrow. Thus, if I can accelerate my progress by avoiding past struggles, I would not hesitate. I still want the lesson and the wisdom, but I don't have to personally experience the pain that goes with it.
I know you have been uber-successful, so I can see why you don’t want to change. However, I hope people don’t assume that I have a miserable life because I wrote an honest post about wanting to avoid errors. I've been very fortunate, and anyone who knows me knows I’m happy. I approach this topic with the following context: I always associate with people who are doing better than me, so I’m constantly “painfully” aware of ways to do things better. This makes me rethink how to solve problems, hence an entire 1500 word-plus post about doing things over. I hope this doesn't sound ungrateful; it's just how I operate.
BTW, this post is actually a partial post (1500 words and yet just a partial post). The full post is over 3000 (down from over 3500 words), but I'll discuss that later!
Cheers!
My recent post Your Do over Guide: What Would You Do Differently?
I sort of agree with Krantcents. In my case I read a philosophy paper back in my late teens that described 3 questions that had to be answered to living a satisfying life. It provided focus for me. It got me to think hard about my life's occupation etc. something that young people don't think about. Instead, many in their mid 20s are sort of just drifting along.
Anyways I wish I would have known the principles of investing back then. I didn't and sold things too early. But it was part of the learning process and part of the satisfaction that comes from finally "getting it".
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I absolutely see the wisdom in both of what you and Krantcents suggest. I think the downside of being addicted to your future is that you often developed distain for the past. I can tell you my discounting the value of a personal process/journey is partly due to my personality (I want stuff done yesterday) and part of the folly of my youth (I'm still relatively young).
That said, those two things are the very reasons I thoroughly enjoy posts at DIY Investor and Krantcents: I learn through your pearls of wisdom. It's saves me grief and is throughly enjoyable 🙂
Thanks for the challenge and the insightful comment.
My recent post Your Do over Guide: What Would You Do Differently?
I don't know a single person personally that wouldn't change a thing about her/his life, although I can very much understand them in case they exist somewhere out there :). And I envy them. But on the other hand, you'll lose the sparkle if you don't have anything you would like to change any more.
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Yes, Anna. We're two of the kind! It's so challenging for me to get inside of someone's head who is completely content with going through pain over learning the lesson an easier way. I try, but I really don't get it. I guess I'm obtuse in this area because I hear the rationale and I still struggle with that perspective. Anyway, I like your whole comment about keeping the sparkle of life. You're right, adaptation is crucial. Why would we unnecessarily disregard a "better path" simply to have things the way they are when our lives could be even more "fabulous."
My recent post Your Do over Guide: What Would You Do Differently?
Don't misunderstand, there are many things I could have done better. I learned a great deal from my mistakes and failures etc. I just do not regret anything I chose to do or decisions I made!
My recent post Stay Late or Go Home?
Well, I certainly appreciate learning from mistakes and failures and also don't really have true "regrets." I guess I just don't get why someone would knowingly repeat mistakes and failures if given the chance to try something different.
My recent post Your Do over Guide: What Would You Do Differently?
Fair enough. I look forward too, except when I digress 😉
I agree, the most important is determining how to get the most of your life now: for yourself, your family, your community, etc.
My recent post Your Do over Guide: What Would You Do Differently?
I think that my environment influenced a lot of my weaknesses and early mistakes. From a financial perspective, I'm played a great game. From a business and risk taking perspective, not so much…
I let other people influence me too easily when I come up with ideas. Many ideas I've had as a kid and when I was in college has been implemented by others.
Even my blog I was slow to start. I bought the domain names years ago, but only just recently (the past 2 years) really put the time necessary into it..
I personally believe that there is always room for improvement. Living life and making mistakes is unavoidable, but not correcting mistakes or optimizing your scenario is very correctable…
I agree. I celebrate the discovery, but I just wish it was faster and less painful.
Your environment is absolutely critical likeyou said. Many people would be extraordinary but for their environments. Tragic! I'm glad you have found your groove!!!
My recent post Your Do over Guide: What Would You Do Differently?
I personally have regrets, and I don't think people can ever do things perfectly. There is also a difference between 'regret' and 'doing things differently'. To me, regret implies a deeper emotional attachment and negativity around a certain event. However, a 'do ever' means 'gosh, I wish I wouldn't have said that stupid comment at the party'. I don't know, I guess we learn (or should learn) from all our life experiences, and good can come from bad experiences.
Personally, I have some health-related regrets, although I didn't have the information necessary to make those decisions at the time that I have now. (And I don't know that I will ever 'appreciate' the events that happened.) Second guessing is incredibly non-productive though if you can't change the outcome and can't learn any more from a particular event.
Now that I have rambled a lot, what I am trying to say is this. I have regret, I have things I wish I could do over, but I have moved on from the point somewhat of beating myself up over my decisions. My new mantra should be "learn and let go".
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If I could do "over" — I know a family that, during the heady days to the easy-credit housing bubble in 2000 – 2008, they flipped houses and used the profits to buy + hold rental properties. When the market crashed in 2008, they were fine because they held a bunch of rental properties that were fully paid off. THATS what I regret not doing 🙂
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Great example and compelling comment! We may never truly 'appreciate' health-related regrets, and for good reason.
I completely agree that second-guess is unproductive.
Also, I love your model: it's seasoned with wisdom. I definitely try not to live my life with regrets either. Berating yourself doesn't typically lead to growth. I think it is very important to learn the lessons from life though. Sometimes allowing your mind to explore the possiblities does though: gain resolution to live your life with more purpose and to avoid repeating some of the previous misteps.
Awesome example. I think about such things too. In hindsight, everything is so crystal clear. I love hearing about how people find ways to achieve their goals in spite of the bad news that gets perpetuated in the media. This is yet another great story of how bad news in the overall economy doesn't have to be bad news in YOUR economy. Again, what a great example!
My recent post Your Do over Guide: What Would You Do Differently?
This has nothing to do with money but I wish I had spent my 20s working out far more….
My recent post Saying “no” to “free” even at Sephora…
That's cool. Health and finances often go together anyway.
I wish I had lifted more. I has a lot of benefits that I didn't even understand
My recent post Your Do over Guide: What Would You Do Differently?
My issue with this is that we never know the consequences of making different choices. Had I gone to a different college I wouldn't have met my wife and my children wouldn't exist. I could have a different wife and different kids, but do I really want to trade? Similarly had I quit the job I have at an opportunity ten years ago I could be unemployed now (like most of the folks who were working there) and my family could be in dire straights. We like to think we'd make better choices than we did, but we never fully know the consequences of our actions and how those consequences would turn out. All you can do is decide on your current and future actions. Learning from the past can be a good exercise, dwelling on it is just delaying your current life.
Yes, I completely agree. I suspect that's the primary reason some people would not want to change things: fear of the deleterious consequences of playing with one's destiny. In fact, this doesn't sound as nice as the purported reason of I'm happy the way things are, but I suspect it is definitely part of the lens detracters are looking through. I also agree with your point about how it is unhealthy to stay in a state of regret over the past. I like an occasional pondering, as it keeps me motivated to do better in the future. Thanks for the great discussion.
What could it have hurt to begin contributing to my IRA right when I got hired, instead of 3+ years down the road? That, and going to college in state to save on tuition, would be my major change.
Nice post!
It's amazing how many young people (20s-ish) think investing for retirement is something to do when you get a little older. On the other hand, observing my students, most of whom work at least part time and many of whom work full-time, I have to allow that few young people earn enough to be able to set anything aside toward retirement, much less any amount that could be called "aggressive." I've suggested to them, when the subject comes up, that they should start by getting in the habit of setting any amount aside, as long as it's on a regular basis.
Even if it's only ten bucks a month, when you get in the habit of saving, it's easy to raise the amount once you start to earn a little more. IMHO staying out of debt is the best thing a young adult can do — this will free up future earnings to be put into savings, rather than committing those earnings to debt service.
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Investing earlier and decreasing college expenses would be two big ones. I think a lot of people in hindsight would have changed those too. Thanks for sharing these!
That's a great point too. I think if we weren't so indoctrinated regarding debt, it wouldn't be such a stretch to have students with decent earnings and who would be able to invest. However, with so many parents living paycheck to paycheck, it ends up being a viscous cycle: little college savings means students are in debt to attend college in many cases, student works and tries to stay afloat, and it takes years to clean up. Before he knows it, he's wondering how in the world did so much time past without him investing.
I like your making saving/investing a habit suggestion. That's good stuff!!
My only regret is not having all te wisdom I have now 20 years back. Very good article!
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You and me too! This reminds me of King Solomon merely asking for wisdom, not realizing that it was the best gift of all. Thanks for your comment.
Thanks for sharing this insightful article! I am so happy to hear that you too agree 100% with investing in yourself…I definitely think that is one of the keys to success in life. Thanks also for inspiring me to take more charge of my retirement NOW.
Awesome article!