When should I live?
That, really, is the daily conundrum faced by millions of people attempting to live life responsibly, given a limited quantum of resources in the form of assets, or debt, and income.
To complicate matters further, is the uncertainty as to what the value of these assets and the level of income is likely to be at any given point in future.
Living with a short-term view
Given the option of spending R100 000 now on realising a life-long dream like skiing in Europe, or rather saving it for the proverbial rainy day, many would argue that life is short and that you only live once, therefore, what the heck, let’s spend it.
These arguments are typically used as sound basis for rather capturing the immediately apparent quality of life on offer, even if it implies less financial security later. Somehow, the human spirit remains eternally optimistic and doggedly believes that any holes you dig yourself into now, will simply dematerialise later, as if by magic.
We live in a society where things or experiences often takes preference, as we are so often exposed to an uncertain tomorrow, popularised by mainstream media.
The truth is that planning ahead and being intentional about the future bears exponential fruit to ignore the future, is like flirting with disaster.
A debt riddled society
A fantastic example is the relative ease with which people will incur debt in order to have something straight away, even though the repayments still has to be earned. What really compound matters is spending borrowed money on perishables like clothing, furniture, holidays and even food.
This mindset is prevalent among all South Africans, particularly among those that can least afford it. I urge all those who deal with clients, employees, school kids and even your own kids to make this message a priority, for the sake of a more certain future.
Clients, and the public in general, must be educated that saving, let alone reducing and not incurring debt, is an absolutely critical component of a sustainable, healthy society. Until this basic education gets the profile at school level that it deserves, it will be up to financial practitioners, and wise parents, in an authentic advisory capacity to disseminate such education as effectively, as widely and as brutally as possible.
Does this now mean that spending the money should forever be postponed until a day when your knees are simply no longer able to carry you down a ski slope?
A marriage of necessity
Clearly, there must be an optimal marriage between your lifetime financial budget and your life allocation of youth and good health.
I believe the key lies in:
• not splashing out at the expense of a systematic diligent monthly savings commitment towards the part of your life when you can’t realistically expect to be economically active;
• being prudent relative to the decision making you observe around you;
•consulting a reputable, licenced family office who doesn’t just sell you stuff but will equip you with an accurate financial dashboard on which to base your decisions, much like flying an aircraft with instrumentation rather than without;
• sucking the maximum fun out of what you do commit to;
• deliberately planning and executing those ideals you feel will define who you are and should be rather than merely acting on impulse;
• also giving towards and enabling the lives of others, instead of defining life merely as what was lived by you personally.
I will argue that in so doing, the next reasonable person out there will live much more, more often and more consistently than when the only game plan for you and your money is simply to hunt the next big moment or acquisition.
