There is a quote attributed to a football coach that says “you are what your record says you are“. It’s one that might apply to the sports world, but I’ve been thinking that it can also be relevant to personal finance.
Let’s say that John Doe is somebody who thinks that he will be future multi-millionaire. He just simply envisions that he will be very successful financially over the long-term, and is going to get there one way or another. That’s the dream, and he feels like he can do it. Might as well dream big, and as the saying goes: where there’s a will, there’s a way.
Now, let’s take a look at John’s current financial situation. He’s 30, and completed his college education early in his 20’s. He has a good job, and has advanced a bit in his career – but he’s not on the fast track to being a CEO. He still has some student loans outstanding, and has a small amount of credit card debt that he hasn’t gotten around to completely paying off. He also has a mortgage on a snazzy new condo, and just bought a new car a year ago. He works hard, plays hard, and likes to live it up.
Do you see the disconnect between his vision of his future, and what his past and current financial situation has demonstrated?
Here is another question: if you were to invest in John, do you think that based on what you have seen, that he’s a slam dunk to be rich like he thinks he will be?
I think that this same concept can be applied to people in a wide range of situations and with different self-perceptions of financial health. Some people just believe that they will be able to retire someday, despite being living deeply in debt. Others don’t care much about their careers. Maybe some others just think that they will marry someone with financial potential. Either way, they just think that their ship will sail in someday.
Well, instead of waiting for the ship to come in (it won’t), it’s probably better to take personal responsibility for one’s finances. Even further, it’s good to critically evaluate what your past behavior indicates about what you’ll be likely to do in the future.
Now, that’s not to say that people can’t learn and change. Of course we can, and there are tons of inspirational stories out there about people who turn things around and reach their goals. Those with a thirst for knowledge, and the desire to actually apply that knowledge through hard work and discipline, can get there.
I think that before this can happen, it’s important to engage in critical thinking and learn about ourselves and our habits. It’s like many other things – if what you did before didn’t work, it probably won’t work in the future. Because what we are today financially is a reflection of our past financial habits and priorities.
So, back to the question: are you what your record says you are? I say we are, but by learning and applying knowledge going forward, we can succeed and get a great, winning record so to speak.
My Questions for You:
What do you think of the notion that you are what your record says you are?
Why do you think some people have a disconnect between their past behavior, and their perceptions of their financial aptitude?
Do you agree that people can change their circumstances by critically examining past behaviors?