Feeling much anxiety over the past week? Worrying about what our new Government might look like, what officials might do? Do you feel like our system is broken or has never been this bad?
This weekend I’ve divided my thoughts into two parts. Part 1 is a short history lesson to show that, “no, this really isn’t the worse it has ever been in our country”. Part 2 includes steps we can take to remain calm and keep control over our own lives.
Part 1 – A Little History
What happens when a Presidential candidate fails to reach a majority in the electoral college? That was the case in 1824 when Andrew Jackson won the most votes in the popular vote and the electoral college. However, he failed to have a majority of electoral votes due to a four-person Presidential race. Oddly enough, all four candidates belonged to the same political party (weird – huh?).
Since none of the candidates obtained a majority in the Electoral College, the decision then fell upon the House of Representatives. The House awarded the Presidency to John Quincy Adams, who had come in second in both popular and electoral votes. Although the 12th Amendment of the Constitution was followed properly, don’t think there wasn’t controversy. Historians still debate what has come to be known as the “corrupt bargain” between John Quincy Adams and Henry Clay. You can read more about it for yourself here:
Part 2 – What can we control?
Yes, elections do matter but your life transitions are more important.
As important as elections are, we believe that a solid financial plan gives you the tools to keep improving your Return on Life no matter what’s happening with our nation’s politics. Instead of fretting about what may or may not happen starting in January, try to focus on these three areas of your life that will help you control your own major transitions.
- You can’t control the economy … but you can control your career.
Elections sometimes spark short-term volatility in the financial markets. But the economy is bigger than any one President, especially while Covid-19 continues to change everyday life and global business.
As companies continue to adapt to the pandemic landscape, job opportunities are becoming less centralized and more diverse which I’ve written about previously. You might be able to take your dream job on the other side of the country without leaving the home your family loves. Or you might spot an emerging market in the middle of all this displacement where you can open your own company.
- You can’t control taxes … but you can control your saving and spending.
Whether your preferred candidate won or lost, there’s no guarantee that your taxes are going up or down. But you can anticipate when your kids will be going to college, if you’ll need to replace the family car soon, or if you want to move to a beachfront condo when you retire.
In my opinion, the single most important factor that leads to the success or failure of personal or financial goals is our behavior. On financial matters, it is how we save or spend.
If you’ve never kept a monthly budget before, make 2021 the year that you start. Sit down and weed out all those recurring subscriptions and memberships you’re not using. Make a weekly meal plan so you’re not eating out so often. The couple hundred dollars you economize every month could grow into a comfortable padding for your nest egg over time.
- You can’t control who is President … but you can take control of your financial plan.
Per the clamor on social media, was this really “the most important election of our lifetimes?” It could be decades before we have enough perspective to judge. But as far as your financial planning goes, here’s another way to think about Presidents:
A 67-year-old baby boomer eyeing retirement might have taken her first part-time job when Lyndon Johnson was President. As of 2020, that senior has lived and worked through ten different presidents.
It’s very doubtful that you’re going to love every single President who serves during your career. Yes, certain things that each one does might move the needle on your retirement accounts in the short term. But it’s folks who stick to their plans and continue to save and invest regardless of what’s happening in the outside world who build long-term wealth.
No matter how you feel about the election, you can take action today to keep your financial plan on track. Please reach out and we can start planning for 2021 and beyond.
Please remember that we are “here” and available for you. If you have any questions or concerns, financial or otherwise, please do not hesitate to call or email. If you have friends, family, or neighbors you feel would benefit from a conversation with me, I’m more than happy to have a call or jump on a Zoom meeting with them.
As always, I hope that you are doing well, and staying safe & healthy!