On thing that too many people are missing is the courage to start and a bias towards action.
There are many forms of hiding, but probably the most common is procrastinating. Instead of taking decisive action now, you’ll just wait until that perfect “someday.”
Of course, the circumstances are never perfect for you to get started. And like Tim Ferriss says in The 4-Hour Workweek, “”Someday” is a disease that will take your dreams to the grave with you.”
If not even starting is the first mistake that people make, giving up too quickly is the second.
Most things take time. There is a long period where it looks like nothing is happening, the things start to click. If you quit to early, you’ll have put in the hardest part of the work, but missed all the benefit.
You need to be impatient when it comes to action and patient when it comes to results.
Let’s look at some of the ways this principle plays out when it comes to personal finance.
Impatient With Action, Patient With Results in Frugality
One of the strategies that I advocate with respect to saving money is the Quick Wins project. The idea is that instead of fighting to hold back on small purchases, you tackle recurring expenses such as:
- Car insurance
- Streaming services
- Gym memberships
Obviously this project requires a bias towards action. It front loads the pain of frugality, but there’s still some mild pain associated with forcing yourself to do it.
It’s easy to just keep putting it off until “next week.”
The nice thing about it, however, is that it eliminates the need for perseverance. Once you complete the project, you lock in the savings. They take a while to accumulate, but they will add up over the course of a year.
Impatient With Action, Patient With Results in Income Generation
Making more money is hard. In fact, I wrote a whole post on this topic.
If you want to make more money, you need to be impatient when it comes to action and patient with the results. Because the results will take time.
First of all, you need to pick a lane. Are you going to be negotiating a raise? Finding freelancing clients? Or maybe you want to take a stab at creating passive income through an online business.
Whatever you do, pick a lane and start taking actions to move that vision forward.
Not only do you need to get started, you probably need a system to stay consistent. My system is that I wake up early every morning to write. That doesn’t have to be your system, but you probably need a system.
Figure out whatever moves the needle most and spend most of your time doing that. For me, that means spending most of my time writing articles and avoiding tweaking all the settings on my website.
Once you get going, you need the ability to keep going. Tell yourself you won’t quit for a year. Focus on results you can control instead of the ones you can’t. For me, this is number of posts published, not traffic. With enough posts published, traffic will come. But right now, the daily fluctuations in traffic are just noise, not signal.
Impatient With Action, Patient With Results in Investing
When it comes to investing, the biggest problem that I see is people stalling as they debate over minutia.
Should I invest in a traditional IRA or a Roth?
Who cares? Flip a coin, pick one, and get started. Seriously. The worst that can happen is that you realize you picked the one that wasn’t optimal and you switch to contributing to the other.
Should I invest in the S&P 500 or a Total Stock Market Index?
Doesn’t matter. They’re very nearly the same thing.
Vanguard or Fidelity?
They’re both good.
Stop stalling and get started.
One framework I created to help with this is called the outcome report card. The idea is simple. Give the possible outcomes of your decisions a letter grade like they have in the school system. If the grades are close, just pick one and move on.
For example, the traditional IRA and the Roth both save you money on taxes, but they do it in different ways. Yes, chances are you’ll be better off with one than the other based on your circumstances, but they will both be good. One will probably be an “A” decision and the other an “A+.” So if you don’t know which is which, just pick one. The worst that can happen is a good outcome.
And of course, with investing like with anything else, the results accumulate slowly over time. We all know that this is how compound interest works. You invest money and get no results. Until you do.
You have to keep investing when it looks like it’s not working to generate enough capital for it to start working.
If you want to get ahead, the sweet spot is being impatiently patient. Impatient with action, patient with results.
The people with the courage to start, the discipline to keep going, and the wisdom to create a system will win.
- Is Dollar-Cost Averaging Worth It? - March 27, 2023
- My Favorite Savings Account With Sub Accounts - March 20, 2023
- The Average 401k Balance by Age - March 13, 2023