Olympic Overlap

Financial PlanningPosted on February 7th, 2018No Comments

Written By: Lauren Stansell, CFP®

The 2018 Winter Olympics are upon us! This year’s festivities are being held in PyeongChang, South Korea and began (last night) with figure skating and will further kick off with the opening ceremony today. Throughout the two weeks, competitions will be held in a total of 15 sports – from bobsled to ice hockey to alpine skiing –with 102 different events on the slopes or on the ice.

While these sports and events may vary widely with respect to the skills needed to win gold, the Olympics and all events surrounding it happen to align well with financial planning – from the planning and preparation process to the implementation to the monitoring. Read more about the dedication, training, performance, and teamwork similarities between the Olympics and the Financial Planning Profession…

Preparation and Training

Successful preparation for the Olympics includes intense dedication, persistent training, and professional coaching, amongst many other things. Athletes must first dedicate themselves to their sport much like we, as financial planners, must dedicate ourselves to our profession. Deciding to compete in the Olympics is not an overnight decision. It is a long-term plan that athletes choose to pursue and stick to over time. Similarly, Clients must dedicate themselves to the financial planning process which is a long-term process. These forms of dedication may not always be easy – there will be challenges and learning moments, for sure – but in the end, we feel that it is worth the investment of time.

Part of that dedication comes in the form of persistent training – athletes train day and night physically, nutritionally, and mentally to improve their skills, health, and robustness for their Olympic competitions. We at Yeske Buie persistently pursue learning and growth; we embody our values of Learn Big, Think Big, and Be Big to continue on the path to becoming the best planners we can be.

Athletes also seek out professional help, something we feel is our role to fill for our Clients. We want to be similar to an Olympic coach – to provide our best thinking, guidance, education, and support. We want to provide feedback when improvements are needed and be there to celebrate successes with our Clients! Simply put, we want to be part of our Clients’ team.

Performance

As we know, endless hours go into preparing for The Olympics in hopes of winning gold. The Games are now upon us and the athletes are ready for action. It’s time to put the dedication and planning into play. We, as financial planners, are ready for our game – taking Clients through the financial planning process; implementing our Evidence-Based Financial Planning, Policy-Based Financial Planning, Safe-Spending Policies, Investment Philosophy; and more. Although there are many individual facets of our financial planning process and relationships, we think our true value is in the combination of all parts in the execution of a successful financial planning relationship with each Client.

Team Play

In most highly valuing the sum of our parts, our approach is similar to a hockey team, made up of individual players with their own strengths and weaknesses who are selectively picked for the way they perform together as a whole. We view financial plans as a sum of the parts of a Client’s entire life, not just the money.

Likewise, when building our Investment Portfolios in alignment with our Investment Philosophy, we consciously pick the building blocks (mutual funds) for the exposure they give us to each segment of the market we’re interested in. But we don’t pick the building blocks one-by-one, we pick them based on the totality of the ideal portfolio and how well they play together.

And, like an athlete strengthening muscles to avoid injury or adjusting mid-game to better compete with an opponent, or a client setting aside funds for an emergency fund or making course corrections along the financial planning path, we build in resilience:

  • We are globally neutral, meaning we invest in the countries of the world as they make up the world economy.
    • For example, the U.S. makes up about half of the world economy and, consequently, about half of our portfolio allocation. We do not have a home-country bias.
    • That being said, when you’re watching the Olympics, if you are rooting for the United States competitors and teams, you may be exhibiting home-country bias and that is just fine!
  • We have a chunk of most portfolios invested in a stable bond fund that is included for stability in volatile times, not for returns. In retirement, this chunk of bonds is purposefully increased to function as the bridge to weather a downturn for six-to-seven years’ worth of spending needs.
  • And, like athletes in the middle of an Olympic event, we are consistently assessing ourselves and our surroundings for any adjustments that may need to be made, like rebalancing accounts, shifting to lower-duration (and less interest-rate sensitive) bonds, etc.

Financial planning and the Olympics seem to have quite a bit in common and we love finding connections between our profession and passion and the world around us!

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“Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure. It is our light, not our darkness that most frightens us. We ask ourselves, Who am I to be brilliant, gorgeous, talented, fabulous? Actually, who are you not to be? Your playing small does not serve the world. There is nothing enlightened about shrinking so that others won't feel insecure around you. We are all meant to shine. And as we let our own light shine, we unconsciously give others permission to do the same. As we are liberated from our own fear, our presence automatically liberates others.” ~Marianne Williamson