Richer by the Day
Ongoing ramblings about personal finance, and all related topics. If it has to do with money, it will be covered here.

Filed under Investing, Rules of Thumb, Saving

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It seems as though many in the personal finance blogging community enjoying playing disc golf, and I am no exception.  I am blessed to live in one of the greatest small cities in the country for disc golfers, with many beautiful, free, and challenging courses.  In fact, the disc golf courses here helped my wife to sell me on the idea of relocating.

As I was playing last week, it crossed my mind that many of the lessons I’ve learned playing disc golf are highly applicable to personal finance.  Here are some that come to mind:

Until It’s in the Basket, The Hole Isn’t Done

It’s easy to lose focus on short putts, because they seem so easy.  What happens as a result?  Some easy birdies become pars and some sure pars become bogies.

Finance Implications: You can’t half-heartedly track your finances and assume everything will be OK, stop managing your investment as retirement nears, or count your profits before you sell a stock.  Losing focus before any of these tasks is fully complete could allow things to quickly get out of control.  In that sense, as the end of an effort approaches, we should focus on it even more intensely.

When Conditions Change, So Too Must Your Approach

I’ve played the same hole a hundred different ways based on the time of year, wind, how I’m feeling that day, or simply due to the fact that my capabilities change as I age.  A hole in one is so hard to repeat because even if we do everything the same internally, external forces are at work.  Understanding those factors, and modifying your approach, is essential to finding continued success.

Finance Implications: Managing your money in a bubble doesn’t make sense either.  You may choose to increase your emergency fund as unemployment rates fluctuate , invest more when market conditions are favorable, prepay your mortgage when alternative investments are less favorable, or reallocate your portfolio as you age.  There may be times when you cut your budget to the bone and others when a little luxury spending will be allowed in.  Learning to see that conditions have changed, and adapting your strategy for the new reality, will help to keep your finances on track.

Don’t use a Hydra on water holes

The Hydra is one of the few discs with the apparently desirable ability to float.  This makes it the perfect disc for holes with large water hazards, right?  Wrong!  Using a disc that floats on a hole with a water hazard is planning for failure.  Instead, I use my best, favorite, or most expensive disc.  Why?  That way I’ll be damn sure to clear the hazard!

Finance Implications: One area where we plan to fail is in buying more insurance than we need.  Insurance is important and adequate coverage essential, but buying more than we need is misguided.  Having so much life insurance that your spouse would get the equivalent of winning the lottery is not a smart move.  When we use products for purposes other then they are designed, we often end up paying more.  Life insurance is supposed to replace the income that you won’t be able to generate if you are dead.  I recommend investing the money saved through lower premiums paid for adequate coverage versus paying more for excessive coverage.

Don’t use an expert disc if you are still a beginner

Using a disc that is beyond your skill level will leave you tired, frustrated, and typically short (and left) of your target.  It takes time for your skills to be honed and your arm speed to increase.  They make beginner and intermediate discs for a reason.  Don’t be ashamed to play a skill-appropriate disc.

Finance Implications: So many of us would do best to stick to sound, time-tested savings and investing methods.  But when we first start out, the promise of outsized gains lures us towards more exotic investments.  Can money be made with currency trading, options, and other derivatives?  Of Course.  Is a new investor more likely to find more consistent long-term success investing in low cost index funds?  I believe so.

One great shot makes the whole day worthwhile

It’s been said that a bad day golfing is better than a good day working and the same is certainly true for disc golf.  It’s also amazing how a single great shot can leave you with a favorable memory of the day.  Every round will have its ups and downs and keeping that in mind will allow you to tolerate your bad shots and celebrate your good ones.

Finance Implications: There are times when managing your finances can seem like a drag.  This is especially true when you’re going through a rough patch, where income is dropping, debt is rising, or a combination of the two.  Unlike your job, where you have limited control, managing your money gives you unlimited control.  So go out there, celebrate your small victories, and above all have fun.

If you are interested in learning more about disc golf, or to find groups or courses in your area, check out The Professional Disc Golf Association.

What lessons has disc golf (or regular golf) taught you about money?


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