As it is Physically, it is Financially

To state the obvious:

This is true in both the psychological as it is physiological.

Having been an interested enthusiast of Fitness and health for the best part of my life, as I enter the second half of my fifth decade on earth, my psychology around my physiology has shifted.

Of course, I strive for incremental improvements in Fitness and strength.

However, in contrast, in my twenties, BIGGER, FASTER, and STRONGER was my primary objective.

It is not that any longer.

As one gets older, it becomes more about maintaining muscle mass than going for growth. So you lose what you don’t use.

Protecting what one has rather than risking an injury by going all out for growth and performance. An injury and time off are setbacks that could take years to recover.

The reason for this is highly complicated, and I won’t do the subject justice it deserves in this short article.

But it came to me, as I was in the gym the other day, how similar it is in my expectation focus and goals regarding my financial portfolio as it is in my expectation and goals physically in the gym.

Zooming in now on investments:

Wealth planning, when dealing with more mature experienced investors and families with larger levels of wealth to manage, it’s an accepted axiom among family offices and wealth managers alike that the primary objective of managing the wealthier client’s money is to protect it first, then, and only then, go for real growth.

Then, once wealth protection has been secured, go for growth as far as possible.

The parallels between Financial investing and Fitness and healthy growth and maintenance are amazing.

Now back to the Physical.

The challenge comes when one has not prioritised health and muscle mass throughout their lives and then has some kind of a health scare later on and starts to address it in one’s late Forties, fifties and beyond.

Yes, it’s possible to gain a lot of muscle mass and strength later in life. However, it is much, much harder. If one doesn’t have sufficient strength and muscle mass, then one is looking at having to be helped in all areas of life later. Simple things like climbing the stairs and even basic hygiene become a challenge, and one may require assistance from other humans.

As it is Physically, it is Financially.

Those poor buggers I’ve met who have not saved and invested as they should have through their lives and started to realise they only have a finite amount of time to accumulate a certain amount of assets. For these people, it’s a tuff hill to climb. Climbing it is, of course, possible but very tough. Suppose it’s not successfully climbed, like in my description of old age above. In that case, they will require help, financial help from someone or some government entity, charity or family member.

BACK TO THE PHYSICAL, let’s say, despite being in reasonable shape, I choose to throw caution to the wind and try to make considerable gains in the gym. Unfortunately, in doing so, I get a severe injury that means I can’t exercise for a substantial amount of time. This, in turn, would allow my body to atrophy at an accelerated rate due to my age, a situation I may never fully recover from in real terms.

The same is true of the portfolios we analyse. We see extremely expensive portfolios exposed to magnitudes of risk that are completely unnecessary for people who are in their late forties or early fifties or beyond. Who really shouldn’t be :

Paying the extreme fees and taking the risk. All it takes is one event out of their control, and the portfolio could suffer a setback from which they may never recover.

Don’t be that person!

Let us help

If you are reading this and have not gained clarity on your current pension, investment or savings product, then take the first positive step today!