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All About the plan

Leadership Discussion, Part 2

I am starting this chat with you based on the assumption that you want to build something. It’s a pretty good assumption. Since the overall subject of this column is retirement plans and the portfolios that fund them, it’s the rare bird that wants those to diminish rather than grow. This month’s joke you’ve probably heard but is often useful:

Q: How do you make a small fortune raising horses?
A: Start with a large fortune.

In our leadership discussion, it’s first essential to establish where you want to go in life. To do so, effectively, and by effectively, I mean that there is some emotional reward at the end, a sense of accomplishment or satisfaction if you will; we need to start with some basics. The first and foremost is to establish our values that will dictate the boundaries of our choices. Then we can add goals that will build rewarding lives within that value system.

As we look for leaders to follow or leadership qualities to attain, we can easily rule out some. For example, those “cocaine cowboys” of the 1980s offered easy money to anyone willing to use their boat for a “one-time” delivery from just offshore to a waiting truck in the Everglades. A fundamental ingrained opposition to illegal activity would have kept most of us from such temptation, and understanding the awful costs in deaths and destroyed lives of the drug trade should have been enough to keep the rest of humanity out of that business as well. Alas, we know society all too often isn’t humane.

But what does such an extreme vile business have to do with us in our wealth-building endeavors? Nothing, other than I often like to use extreme examples as a reminder for more subtle moral questions that arise in daily life.

leadership discussionErgo, Leadership Discussion Quality # 1 for us: Integrity, constant and vigorous

We had a football coach at my alma mater that was described as a man of great integrity. However, every game, he would explode into fits of rage and spew profane diatribes at the officials or kids he was tasked with leading. I considered this a character flaw and shameful conduct, but others sometimes tell me I am often too judgmental.

Leadership Discussion Quality # 2: Discernment

This is a tricky one. Yes, we need to avoid condemning people, but leaders MUST exercise discernment. Leadership is a component of getting us to a desired destination; it is not designed to make us comfortable (unless, of course, comfort is the goal), nor is the task of always leading a pleasant chore. If we are to be of serious purpose, we must decide what to participate in and to what level, and we need to do so before the decision time arrives.

Leadership Discussion Quality 3: Vision

There are many goals we can take on in life that are acceptable from a value and integrity standpoint that are worthy goals but not worthwhile or of interest to us. I remember Paul Newman (as Butch Cassidy) saying to Robert Redford (The Sundance Kid) as they rode horses back to Hole in The Wall, “I have vision, and the rest of the world wears bifocals.”

What is your ultimate goal for your investment account? As a primary goal, most of us wish to have enough income to fund the lifestyle we have today and to be able to afford the cost of potential health challenges in dignity and a measure of comfort. Some of us would like to add travel, a vacation home, additional gifting, and such to retirement. All are reasonable and worthy goals that are likely attainable with planning and effort.

Then I have clients that have said (somewhat tongue-in-cheek), “I want to have enough money so that my check to the undertaker bounces!” Most say, “I want to be able to afford my expenses throughout my lifetime and then leave whatever is left to the kids.” Others have unique issues to fund beyond their lifetimes, such as special-needs relatives or charitable entities. As for me, I’m trying to plan the best I know how to provide for my almost-three-year-old twin grandchildren. I’m going to have to educate and trust many people to stay on board with the plan for this to come to fruition.

This brings us to the final Leadership Discussion Quality: Perseverance.

I have asked my daughters to sit outside together sometime in their 60s, and one is to ask the other this question:

“Why are we sitting in the shade today?”

My hope is the answer is: “Because Dad planted a tree a long time ago.”

It’s a nice image for me.

October 2021

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. No strategy assures success or protects against loss. Investing involves risk including loss of principal.

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