Are you Responsible?
There are two ways to achieve the things you want in life, taking responsibility yourself or giving away that responsibility.
For example to buy new car, taking responsibility yourself would be to save by spending less than you earn and giving away responsibility would be buying a lotto ticket and crossing your fingers.
Here’s some more examples
Goal: Retire before your 50 by investing in property
Give away responsibility: Go to a free investment seminar, sign up to buy off the plan investment property right there and then.
Outcome: The properties turn out to be hard to rent out, the agents fees eat your profits. The agent operating the scheme closes down.
Take responsibility: Learn about property investment, read articles, research the pitfalls.
Outcome: You feel confident to buy a modest apartment in a popular location, the rental income produces cash flow.
Goal: You want to own your own home by obtaining a mortgage
Give away responsibility – The estate agent suggests a broker, the broker makes a special visit to you and takes lots of personal information, you sign up with that broker and accept the first mortgage they
Outcome: As the broker only gets commission from some lenders the best mortgage they suggest is one at a 5% interest rate. This costs you $200,000 more than the best 4% rate over 25 years.
take responsibility – You research mortgages yourself, you find the features you want, you find the most suitable lender for you.
Outcome: Your mortgage has the best rate of 4%. You save $200,000 over 25 years
Goal: fund retirement by contributing to superannuation
Give away responsibility – Your employer gives you the details of their company superfund, you like the glossy brochure and feel safe that the company scheme is good as everyone else uses it.
Outcome: You are deprived of $100,000 by retirement due to high fees.
Take responsibility: You research superannuation, you find out the basics, you compare the work one to some other funds and see there is a big difference in fees. You see the work scheme is charging much higher fees than an industry fund.
Outcome: You save $100,000 by retirement through lower fees. You feel comfortable with the knowledge to switch superfunds to get the best deal.
What is wrong with giving away responsibility?
- You don’t know if you are getting a good deal – by handing over responsibility you usually have to pay for a service, this is fine if you pay for expert advice that saves you more than it costs, on the other hand a salesperson could cost you much more than they benefit you. How do you know the difference between the expert and the salesperson if you don’t even understand the basics?
- No guarantee – giving responsibility to someone else does not ensure you will meet your goal, there will always be a disclaimer that the outcome ultimately rests with you. E.g. A personal trainer will guarantee to make you fitter but only with the condition that you show up and do pushups every day.
- You are dependent – If your outsourcer disappears you won’t know what to do next, your confidence takes a hit and you will be unable to deal with issues that arise.
- Not in your best interest – Are they getting you to your goal in the quickest and most cost effective way? Look what happens when people entrust their life savings to dodgy financial advisors featured in the news recently.
I’m not advocating here that you do everything yourself, there is a time for expert advice, but advice should be exactly that, advice, the problems start when assistance becomes blind dependence.
In order to get what you want out of life you have to do something to get it. Or in other words to achieve a goal you have to do an activity in a certain way or method. (OK, I admit not a ground breaking insight so far)
For example, to be rich (goal), I get more money (activity), by buying a lotto ticket (method)
It’s the method or way of doing an activity that I want to focus on. I think methods can be split into two types:
- Take responsibility yourself
- Give away responsibility
give away resp – letting your partner manage all your finances
Goal: You want to have more money
activity: less outgoings, more income
give away responsibility – buy lotto ticket, take financial advice from an advisor from the bank, let them get you a mortgage
take responsibility – first look at how much money you have, ask questions, find answers, think what you really want, what is the problem, stop spending so much, try to find ways to earn more. ask a mate how they become so rich, pay for financial advice.
Goal: You want to be an entreprenuer:
Activity: learning to work for your self
Give away responsibility – sign up for a course on entrepenuership, do nothing until the course starts and then wait for the lecturer to tell you exactly what to do and how to do it
Take responsbility – then go and sell something, make something, help someone
Goal: Feel less stressed and in control of your life
Give away responsibility – Take a weekend meditation course, learn interesting things, feel great, come home, promise to meditate every day but slowly start to forget about it.
Take responsibility –
What you know
Don’t be put off if you don’t know anything about it. Go and fucking type it in Google and spend 5 minutes learning about it.
How NOT to take responsibility
They are trying to make money by offering a way for you to get what you want (indirectly), not what you actually want.
- Take this course to become an entreprenuer *
- Come to our Gym to get fit *
- Buy investment property through us and get rich *
- Take this mediation course to be less stressed in your life *
- Buy this lotto ticket to get super rich and never work again *
- Taking this mortgage will allow to own your own home *
- Taking our superannuation scheme will fund your retirement *
The problem is that the way does not guarantee to give you what you want. Thats what they fail to mention.
There should be a * next to each one of these statements, where * = but we don’t guarantee it
They offer but never promise
Going to a gym does not get you fit, its what you actually do at the gym that does.
A personal trainer does not alone get you fit, just paying a personal trainer will not magically make you lose 5 kgs, its what you agree to do as suggested by them that makes you fit. It’s the exercise that you have to do that makes you lose weight.
It comes down to this, ultimately YOU have to do an activity to achieve your goal
Don’t confuse the method to do an activity with the activity.
A way to get exercise (the activity) in order to get fit (the goal) is to get a personal trainer (a method), another possible way is to get the stairs instead of the lift. (another method)
So we have 2 types of methods to do your activity:
- take responsibility yourself – eg climbing the stairs
- give away responsibility – eg personal trainer
think of how a child does things
If I really, really really, wanted to learn to play the piano, I would draw a piano keys on some paper and then hum along and pretend I was playing the piano, I then might get a book on how to play the piano from the library, I might then see if I could get a cheap or borrow a crappy bontempiu keyboard and just start mashing the keys, until eventually I found noises I like, then get a book, learn the rules, learn chords, learn music. The point is, if you really want to do something, you would simply do it, you would find a way.
Branson, no money, shoe shop, record shop above it. “How would you like it if I could bring you customers every day through your shop?”
Advice or sales pitch – the simple test
Ask, does this person have something to gain if I do what they say?
It all comes down to others motivations. Why is this person suggesting I do this thing? (take this mortgage, have a personal trainer, buy this house)
Don’t take advice from a salesperson, take advice from an expert you have found yourself.
Never confuse the two. How do you tell the difference? easy, ask what they get out of it. If they get some kind of payment for their ‘advice’ then walk away.
“You don’t ask the barber if you need a haircut”
Stop doing the indirect and thinking that is enough, is it not enough it is not taking responsiblity, you are simply passing the resposibility for your health, wealth or job fulfilment to someone else.
give away responsibility – someone else calls the shots, you do what they say without question, without understanding the basics
take responsibility – you call the shots, but you may take suggestions from experts
Outsourcing motivation only works for so long, because lasting motivation comes from within.
So if you have no interest in finance, is it OK to find an advisor and let them do everything?
Ask yourself why you have no interest in your money. It is because it worries you? It is because you never have any left at the end of the month?
This might be OK if you find an advisor who is honest and looks after you
Not to say all courses are a waste of time – just that they should not be used as a way to first learn something. If you really care and want to learn something or make a change then think what can you do right now that will achieve that. Take control, take responsilbility.
You are the boss, you have the plan, you decide what should happen next.