The Ocean & Investing Shows No Mercy

No Mercy Given By What You Can't See

by: Brendan Magee

I can't imagine the anguish that the parents of Austin Stephanos And Perry Cohen are going through right now. No doubt you have read or seen the news on the two boys who have been missing off the coast of Florida when they went out on a fishing trip about a week ago. To have your 14 year old sons lost at sea for days has to be about the worst nightmare come to life for any parent. My prayers go out to those boys, their families, and the men and women who are conducting the search. I hope everyone is home safe and sound real soon.

Looking back your vision is always 20/20. We look and see things that we should never have engaged in and clear alternatives to decisions that turned out badly. Perhaps, Austin and Perry's parents would have never let them take a boat out by themselves under any circumstances. Perhaps, the parents would have told the boys they couldn't go fishing until an adult who had years of experience and a license could accompany them. I have to imagine there is a lot of second guessing going on in their minds these days

With investing we can also see clearly looking back. If an investment went bad, no doubt there would be things that would have been done differently. For example, "My gut was telling me that investment adviser's recommendations  didn't feel right and if I had to do it over again, "I would have held off on investing that money in that fund!" In the moment prudent decisions can be hard to see. We get excited, scared, misread, misunderstand over estimate under estimate, etc.


None the less, we can't go back and change the things we've done or the impact they have had on our lives. The big problem is that we don't always have the opportunity or the wisdom to double check what we can't see in making our decisions.

I would imagine that neither Austin or Perry knew that a storm was brewing off the coast of Florida. Unfortunately that lack of knowledge or foresight could prove to be fatal and life altering for their families. I would imagine that in November of 2008 when investors took $58 billion out of the market they couldn't see the rebound that was coming in less than six months. I imagine the investors who absorbed huge losses when China's Stock Exchange plummeted earlier this month couldn't see that coming either. If they threw caution to the wind and loaded up on Chinese stocks they absorbed a loss whose impact is most likely permanent.

The point is it is easy to lose perspective. We get confident in abilities that we do not have. We convince ourselves that the bad things that happen to people when they break the rules of investing won't be too  bad or only happen to other people. That is when we pay a price we never bargained for and couldn't imagine how painful it could be.

The better part of valor is to swallow our pride  and enlist the help of someone else who will act as another set of eyes and ears to see and hear what we can't. We can't always tell we've had too much to drink, but our friends can. We can't always see when we are about to break the rules for investing, but a coach can. In either case the better outcome is to not drive and not make a decision that could cost you everything. You will live and one day you will look back and thank God somebody stepped in and cared enough to stop you.


Brendan Magee is the founder and president of Inevitable Wealth Coaching. With questions or comments go to www.coachgee.com or call 610-446-4322.

Confront or Turn The Other Way?

Confront or Stay Silent?

by: Brendan Magee

Today, I am filling up my car with gas, thankful that I paid .30 cents less per gallon due to my super market's bonus points program. A young couple pulls up at the next pump to fill up their lawn mowers and pick up truck. The guy is pumping gas while his lady passenger sits in the front seat with the window down smoking her cigarette. I am having visions of the movie The Towering Inferno. What do you do? Let the couple know they are putting themselves and everyone else at the gas station in danger and risk getting punched in the nose? Honestly, I chose to pump my gas, stay silent, and get the hell out of there as soon as I could.

It doesn't get much more personal than telling someone that their behavior or choices are the source of their failures.This is the dragon that Investor Coach and investor have to slay before investors are going to start achieving the success.

I saw a post on Facebook and the woman was blaming Wall Street for the Crash of 2008. It's easy to blame someone or someone else for our shortcomings. The President, Congress, my ex-wife, my parents, Wall Street etc. are so much easier to blame. If it's their fault I don't have to feel the sting of responsibilities I have failed to live up to. I also stay stuck, but the reality is investors really don't have Wall Street or anyone else to blame for their investing problems.

Yesterday I saw a statistic that was pretty amazing. U.S. Large Company Stocks since 1926 has had annualized returns of a little more than 10%. To put that in perspective, that means that roughly every seven years an investor would have doubled their money if they deposited the money in that asset class and just left it alone. Imagine, that in spite of Depressions, wars, oil embargoes, terrorist attacks, Presidential assasinations, etc. that you would have made out so well.

The key word in that last paragraph is left it alone. Investors behavior has not been consistent with leave it alone. In that same set of statistics investors have been shown to make changes to their portfolios roughly every three years. What they are doing is selling investments that are not performing or have lost money and buying investments that have done better or are expected to do better in the future. In actuality they are buying high selling low.

As opposed to the 10% return of U.S. Large Company Stocks, the average annualized stock mutual fund investors returns are hovering around 3.25%, barely enough to stay ahead of inflation.

So what are we supposed to do? Do we not have the uncomfortable conversations? Do we never give the investor an opportunity to see that they are the ones responsible for crippling their financial security? Do we never give the investor the opportunity to taste and feel the amazing sensation of transformation?Imagine how your life would change if all of a sudden you could stick to the behaviors that will get them to the point where they are doubling their money every seven to ten years? What does that make possible?

Now imagine on your deathbed you had the revelation that that conversation and all the possibilities it would have created for you and your family was withheld from you, simply because it was safer?


A very wise woman once told me that our power as human beings is in being responsible and being generous. I think this applies to coach and investor. We need to own up to where we are not being responsible. We might have to own up to the fact that we are avoiding difficult conversations because it's safer. We might also have to be generous to ourselves and not make ourselves out to be terrible human beings for making mistakes in the past, maybe knowingly and turning a blind eye to them. Perhaps in forgiving ourselves, it will make it easier to forgive others.

We can't do much worse then we've been doing.


Brendan Magee is the owner and founder of Inevitable Wealth Coaching. With question or comment go to www.coachgee.com or call 610-446-4322.
  

Investors, Are You Doing The Work?

Investors, Are You Doing The Work?

by: Brendan Magee

Over the last two years I have been engaged in a pretty intense workout regimen. If you are familiar with the CrossFit craze that has been sweeping across the country you might have an idea of what I am talking about. The intense hour long workout involves a lot of sit ups, push ups, burpees, mountain climbers, running in place, planks, hitting a heavy bag, etc. When finished, there is no doubt as to whether or not I have worked out. My weight has dropped by about 20 pounds in that time.

Prior to starting this workout regimen I went to the gym four to five days a week did a little treadmill work, stationary bike, some weights, etc and went home. I went to the gym but did I workout? The truth is, not really. Then in October of 2013 I had routine check up with my cardiologist. My weight was up to 214 lbs and cholesterol was higher than ever. 

When the doctor asked if I worked out I answered yes, but in the back of mind I knew I really wasn't. Nobody else but me really knew the truth. It also didn't help that with every lunch I ate,  I had a nice bag of potato chips and a couple of Cokes. As far as my health and vitality were concerned, I wasn't doing the work. The choices were pretty clear, stay on the same course and die or get to work and hopefully live to see my grandchildren. 

The same dilemma faces many investors. Rather than health and vitality (which can be affected by your finances), what is at stake is your peace of mind, quality of life, and freedom. How much or how little of these things you get to experience are tied to how much work you are putting into your money and investments. Merely, putting money into a 401k or an I.R.A. is not doing the work necessary to achieve peace of mind. Matter of fact if that is all that you do, there is a pretty good job your finances will suffer even more.

Putting in the work means determining your investment philosophy. How will your money should be managed is what is being answered by determining your investment philosophy. It means coming to an understanding of how markets and the world of investing actually work. Putting in the work means taking a look in the mirror and getting that some of your behavior and decisions could be  contributing to your lack of financial security. 

It might mean coming to the realization that on your own you will more than likely screw things up and accepting that you need a coach in your life.  

The work doesn't entail giving an investment adviser your money to invest and then walking away leaving your financial future solely in their hands. It entails participating in a system to verify that your advisers decisions are consistent with achieving your agenda. It entails attending investor briefings so that you can stay close to why what is being done with your is the best course of action. Money alone doesn't do the work. Your time, effort, energy, and passion are required. 

Sure there are pills that I could take to lose weight. These pills also promise that I could continue to eat potato chips and drink beer to my hearts content, but we have heard the horror stories that are associated with those wonder drugs. There are also those, via web sites, that tell you all you will have to do is fill out a few questions on an electronic form and from there all your investment worries will be a thing of the past. God help you with those side effects. 

The realization and we have probably all, painfully, come to this realization more than once is that there is no such thing as a free lunch. The cost usually involves money, but that is the easiest part of the solution. The real elixir is your time, effort, attention, and ego. Giving more of some of these and putting the other aside usually produces the results we are looking for. 

Brendan Magee is the founder and president of Inevitable Wealth Coaching. With questions or comments go to www.coachgee.com or call 610-446-4322.