Imagine that you are driving your car in heavy traffic on one of the busiest roads in Metro Manila. You are in the middle lane. You suddenly see the lane to your left start to move while your lane and the one to your right are still motionless. You also see space that would allow you to easily veer to the left lane.
So you make that move to the left lane and slowly inch away from the car that was previously in front you in the middle lane. All of a sudden, the left lane stops. Unexpectedly, a car stalls a few vehicles ahead of you. At the same time, the other lanes start to move forward so much so that the car previously ahead of you in the middle lane goes past you. Arrgh!
The question is, “Who do you blame?” The answer is nobody; not even you!
Nobody is omniscient. When we make decisions, we will always not have all of the necessary inputs. Each decision we make will be best the decision based on information available to us at the time. If things do not go as planned, it will just be another lesson learned that will hopefully make us better in making similar decisions in the future.
The same goes with managing money. Take the case of deciding on whether to invest in a piece of property for resale or not. Intuitively, holding on to propertyshould be a no brainer because even if we are not able to resell the property, we will still end up holding a tangible asset.
But holding on to a non-earning asset is like holding on to dead money. Money could have been put to better use had it been invested even in a simple time deposit. We must not forget the original goal for buying the property, which was to make a profit from reselling it.
Clearly, we need to make well-informed decisions. But for fear of making a mistake, we may opt to ask the experts. Experts can guide us into making the best decision by identifying the factors that need to be considered. In buying property for example, experts would say that we need to consider among others the following:
This is not to say that we should not consult experts in making decisions. Experts provide a great service. However, we should own the decisions we make in adopting money management strategies to achieve our specific financial goals. If things pan out, then achieving our goals is the reward. If they don’t, we should not play the blame game. Instead, we should get up, dust ourselves off, learn from our mistakes and move on.
If this was helpful, please share or like it.
Be a financial advisor, join our career orientation. - click here.