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“A Long December” by alt/rock band Counting Crows opens with lyrics that speak of hopefulness and regret:
A long December and there’s reason to believeMaybe this year will be better than the last……Every year, we look forward to the next year with hope that it will be better. But we all know there are no guarantees. There are no assurances that the good things in our life will continue or improve.But when it comes to your money life, the good news is that we can control some important things. Other things are beyond the scope of our input.In order to have the most success, you need to be active in some very specific areas of your life.The best place to start is to look at your past and consider what worked and what didn’t– then create your “wins and losses.” If there are any losses in the column of things you could have controlled, you should note and consider them. Ask yourself what you could have done differently and what would have prompted a decision that would have brought about a better outcome.When I say look at your past, I am not talking about looking at which stocks did best and deciding that you should have purchased them. That’s Monday morning quarterbacking at its absolute worst! I am talking about your overall game plan of success.Consider the following areas where you have control (either complete or to some degree). 1. Your Money Life-create a money life that makes sense to you, keeping debt low and expenses controllable to the extent possible. You can control your discretionary spending (vacations, entertainment, etc.) by dialing them back to a degree that allows you to channel more of your wealth into providing security. You want to have a reasonable emergency fund of liquid savings ( depending on your situation, you might want anywhere from four months to one year of expenses stashed away). 2. Your Health-while there’s a lot you can’t control, there’s a lot you can control, like choosing to exercise, eat sensibly, and get checked out by your physician. You cannot control if you are the victim of an unpreventable illness or accident, but you can work with a determination to stay as fit as possible, both physically and emotionally. 3. Your Home-if you are living within your means, your home should be a place of comfort, rather than stress. If you’ve taken on too big of a burden, your home can become a source of stress and anxiety. You are in control of your own lifestyle. 4. Your Career-we live in a society where very little is secure. Jobs get outsourced overseas or job skills become obsolete. Avoid regret by understanding your career and what can impact your security. 5. Your Family-you can protect your family by taking appropriate measures. This means having health insurance, disability, life, and property protection to amounts that are right for your needs and budget. It also means having a Will and appropriate documents that protect them, to the extent possible, in case of disability or death.Regret is a terrible state in which to reside. It comes from looking back and seeing that you could have changed an unfavorable outcome. While you may experience the impact of an uncontrollable event, you can take solace out of the fact that you did all you could, checked all the boxes, and took the most proactive approach possible.Avoid the “long December” of regret. Start now. Begin with that which means most to you and build your steps forward. You cannot build a comfortable retirement if you wait too long; you cannot insure your health at a reasonable cost if you are unfit. You cannot prepare for an economic disruption unless you consider the impact and plan for what will help you get through it.Look forward with hopefulness that next year will be better than the last when you are adequately prepared. Where there’s a will…