Here are a few lessons from the golf course that can help you with your financial goals:
Follow a Routine
If you’ve ever watched a golf tournament, you may have noticed that many of the pros go through a routine before making a shot. This routine can be key to sustained performance.
Investors can also create a routine that drives action. That routine should include specific steps, such as defining your overall financial strategy, measuring risk tolerance, knowing your time horizon and aggressively saving. Consider moves you can make on auto-pilot, such as regularly putting money into a 401K
Focus on the Fundamentals
Every pro golfer can strip down each shot to the fundamentals—grip, stance and alignment. If shots are starting to go off-line, many times the problem can be attributed to one of those fundamentals being off—small issues such as a grip that’s too tight or knees that are too straight can be enough to throw off an entire swing.
The same goes with investors who find they are off-track with financial goals. Often the issue is a small tweak to their financial situation. Is spending outstripping saving? Does your asset allocation need to be adjusted so you can take on more or less risk? Once you identify the problem, you can make the necessary adjustments to get back on course.
Seek Good Advice
Even with all their success, top pro golfers still work regularly with a swing coach and adhere to their guidance. Similarly, even investors who think they are on top of their game may want to find reliable Financial Advisors who can help them assess their strengths and weaknesses, identify long-term goals and design a plan to help them work towards their goals.
Your Swing Is Your Own
Each professional golfer has a unique swing that works best for their game. Still, many amateur golfers look to emulate those swings when they hit the links on the weekend, rather than developing their own. The same is often true for investors. Resist the temptation to make sweeping changes in your own portfolio when a friend brags of better returns. Instead, stick to the unique financial strategy created for your situation to help find investment success. In both golf and investing, persistence and consistency will reward you.
Be in the Zone
Channel the focus of pro golfers when they’re playing well. Investors should learn to tune out the noise—which can include market swings, following financial news anxiously and chasing stock tips. Stay in the zone by focusing on your financial strategy
Bad Shots Happen
Experienced golfers know that they will hit a certain number of bad shots per round. Professionals say the goal shouldn’t be to avoid making any bad shots, but to develop and maintain the emotional equilibrium to focus on the next shot, and the one after that, so that you ultimately stay on track.
Similarly, investors working toward a financial goal can’t and shouldn’t expect a constant upward trend. Market volatility and down cycles are bound to happen. When market volatility hits, the key is to not make a rash decision that upends all of your progress.
The opinions voiced are for general information only and are not intended to provide specific advice or recommendations for any individual. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.