Charting your personal success

Charting your personal success

Someone on Instagram asked the other day what would it take to retire by forty with, give or take, a twenty-year runway. To him achieving retirement by forty is the true definition of success.

The honest answer to that question would be “I don’t know”. In the larger sense, my answer would be, “it depends”. It’s a standard cop-out answer offered by a lot of economists, finance people, and just about pretty much everyone. What’s missing from this question? Well, a lot of things. It lacks detail, for starters, there’s no real clarity to what is to be achieved. What does success look like at forty?

Self reflection is important when it comes to goal setting. The definition of success needs to come from you. Success can mean many things to many different people. To you, having five million Ringgit in your account could be the goal you want to achieve by the time you reach forty. Dump it in an account that yields 3% per year, and you’re looking at RM150 thousand in dividends/interest, a year. That’s a really, really decent amount of money to live on.

To others, success could be, owning a dope sports car, a large mansion, having little possession but being able to travel whenever you can.

The point is, to be able to work towards success, you have to figure out what your version of success is first. You can look around for ideas of what you want to achieve, but bare in mind that maybe accumulation of material stuff might not be for you. It could be the pursuit of experience, having a family or becoming an expert at something. The key is, find out what’s best for you.

Once you know what success looks like, create a goal, stick to the S.M.A.R.T principle when building one, which is; Specific, Measurable, Attainable, Relevant, and Timely.

Though your pursuit might not be of worldly materials, let’s not pretend that you won’t need money to chase your dreams. Some people people say that money is a means to an end, not the end itself. I’ll leave it to you to agree or not to that statement, but what we can agree on is that money is involved, like it or not.

I read this article earlier this week which talks about what Millennials and Gen Z-ers wished they were taught about in finance, versus the advice given to them. Over 40% wanted to know more about how to the stock market worked, and how to manage an investment portfolio. Instead, what they got was advice on how to create a budget, and how to begin saving for retirement.

Up, up, and away!

I suppose if the stock market did this, I’d be pretty salty too about not learning about it in 2008. I’d be rolling in cash today if I had started investing in 2009.

The thing is, though there’s nothing wrong about learning how to invest early, if you’re like most people, you’re not going to have much to begin with. If you’re a trust fund kid, all the power to you, invest all you want.

Managing your money is also like learning to ride a bicycle (almost). You begin with the basics. There’s nothing more basic than learning how to properly budget (read here). First learn about your spending patterns, identify areas for improvement. Start your savings habit, build up your reserves. Thennnn after all that, you’d want to think about investing. Let’s face it, investing is great, when things go your way. But when it doesn’t things can go really wrong. If you’ve gone and invested your rainy day funds, it’s going to really, really, really, suck.

So, when charting your own financial journey, start at the beginning, but have an end in mind. Build yourself up incrementally. Don’t try to jump into the deep end right away. We hear a lot of stories about people who made it big investing their money, but we rarely hear about those who crashed and burned (believe me, there are plenty).

Crash and burn!

Life can hit you in many ways. Life will throw a wrench in your works, and laugh at you as you trip up face first into the dirt. But the least we can do, is plan a course. Know where we want to get to, know where we are, and try to fill in the blanks. When life leads you sideways, you’ll know what you need to get you back on track, or find another way if necessary. Like they say, failure to plan is planning to fail.

Remember, figure out what success means to you, and think about how to get there. Build yourself up incrementally.

I’ll also leave you with a quote from one of my favourite authors, Nassim Nicholas Taleb (smart guy, but probably a buzzkill at dinner tables), for you to think about:

“Missing a train is only painful if you run after it! Likewise, not matching the idea of success others expect from you is only painful if that’s what you are seeking.”
― Nassim Nicholas TalebThe Black Swan: The Impact of the Highly Improbable

What does success mean to you? Tell us in the comments section below!


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