HAPPY BIRTHDAY: TURN PAST MISTAKES INTO FUTURE SUCCESS

I remember when the candle shop burned down. Everyone stood around singing ‘Happy Birthday.’ Steven Wright

So today is my birthday. I am not writing this as a subtle reminder for certain family members or employees to quickly run out and buy me a gift and a cake! In fact they all know that I would rather save the money. I guess the older you get the cheaper you get!

Throughout the year we have certain times that are ripe for personal reflection. Obviously Yom Kippur and Rosh Hashana come to mind but I think a birthday is a great time to reflect as well. The older you get the more you tend to look back on the past. The problem that I see with others as they look back and focus on the “what could have been” they stop there and get depressed, instead of learning from the past to better their future. I think that you should look back and focus on what went wrong and then use that to make certain changes going forward.

Writing about the significance of a birthday, Simon Jacobson of Chabad.org says, “It is also an occasion to rethink your life: How great is the disparity between what I have accomplished and what I can accomplish?” He continues, “How can I strengthen the thread that connects my outer life and my inner life? A birthday can also teach us the concept of rebirth. To recall our birth is to recall a new beginning. No matter how things went yesterday, or last year, we always have the capacity to try again.”

When it comes to money people often tell me that had they just done such and such they would be millionaires by now. If all you do is look back with regret, it’s going to be hard to solve problems moving forward. Over my investing life I can say that had I followed my instincts and bought 2 specific stocks, there wouldn’t have been a need for a mortgage. Now I can sit and cry about it and accomplish nothing or learn from the mistakes, understand what I did wrong, and if the same type of opportunity comes along pounce on it.

Make the change

No one says that change is easy. But just because you have lived a certain way financially for decades doesn’t mean that you can’t change. Start making smart financial decisions. If you live in financial chaos and felt that you were being pulled in many directions and sinking into debt, take control of your situation, start to make financial order and get on a budget. It’s okay to say no sometimes. Yes you may seem like the bad-guy for telling your kids that you can’t buy them a basketball hoop or an iPad, but you need to have the confidence that by saying no, you are immediately improving your family’s financial situation. Some sacrifice today will enable you to live comfortably in the future.

If you don’t have the money, don’t make the purchase. When I am volunteering helping families get out of debt I often hear excuse after excuse as why the family “needs” to buy something, and why it has to be the more expensive option. They always justify their decision, but forget the most basic principle. You can’t buy what you can’t afford.

Look forward as well. You need to define your goals. Where do you want to be in 5-10 years?  Take some time to just sit and think. In today’s fast paced instant gratification culture, taking a few minutes just to think is unheard of. But if you want to change and or improve your financial situation take a few minutes and start jotting down some short, medium and long-term goals. If you are married I recommend that each spouse write down their goals separately and then sit down and go over them together. Then come to a common ground, speak with a financial professional to figure out how you can achieve those goals.

Don’t fret over getting a year older. Use the day to your advantage and try and make some positive changes in your life.

The information contained in this article reflects the opinion of the author and not necessarily the opinion of Portfolio Resources Group, Inc. or its affiliates.

Aaron Katsman is author of the book Retirement GPS: How to Navigate Your Way to A Secure Financial Future with Global Investing (McGraw-Hill), and is a licensed financial professional both in the United States and Israel, and helps people who open investment accounts in the United States. Securities are offered through Portfolio Resources Group, Inc. (www.prginc.net). Member FINRA, SIPC, MSRB, SIFMA. For more information, call (02) 624-0995 visit www.gpsinvestor.com or email aaron@lighthousecapital.co.il.