How You Are Like PopcornSubmitted by Blue Rock Wealth Management on October 21st, 2015
You probably thought you had nothing in common with popcorn. I could make a strong argument that you do have at least one thing in common with popcorn, especially the microwaveable kind (which is the only kind my children know exist in case you are wondering).
I'm in the break room cracking open a bag of popcorn one afternoon. Right at the seam on the label reads a warning: "Do not use your microwave's popcorn button: Every microwave is different. To prevent overcooking, stay by your microwave & listen for popping to slow to one pop every two seconds."
As I stare at the bag, I think back to some of the common mistakes investors make. They fail to consider their uniqueness. They go on autopilot. When it comes time to enroll in the company retirement plan, they judge themselves by what their co-workers are doing, not their on personal goals & needs. Worse yet, they ask the office guru or listen to a talking head on TV who knows nothing of them and pick their investments based on whatever recommendation is shouted that day.
Other times, people get off to a good start but then they fall into another trap - They leave the microwave! The phone rings. The babysitter calls to tell you the dog is chewing your dining room table leg. A tweet buzzes on your phone. Before you know it, the putrid smell of burnt popcorn waifs through the room.
Is there anything worse? Sometimes you think you can salvage the bag. "It's just a little burnt. I can pick out the discolored ones," you tell yourself. You eat a couple of kernels and then get a nasty surprise. Your co-workers complain, "Who burnt popcorn?" outing you in this passive aggressive sort of way. BAD all of the way around.
In the same way, life distracts us from monitoring our process toward our financial goals. Even if you started off with a plan in place and a well crafted investment strategy, things change. That growth allocation was fine earlier but now you're 55. A sharp market decline quietly burns the popcorn. By the time you smell it, it's too late.
So, how do you avoid the party foul of burnt popcorn? Remember that you, like your microwave, are unique. Work with an advisor who knows your personally, cares about your success and makes sure the microwave is not left unattended.