Focusing on the wrong thing. It happens all the time. It happened in the Super Bowl last night, and it happens in finance every day. There was a questionable penalty in the game last night that everyone seems to think cost the Eagles the game. In reality, the Eagles defense being non-existent in the second half cost them the game, but that’s less of a juicy story.
The same can be said for your finances. While a specific investment you own might have been down big last year, that might not be the main reason why your plan isn’t working. The real reason could be a poor savings rate, or spending too much money, but that’s less exciting to focus on.
Moral of the story: focus on the right stuff!
Here’s what I’ve been reading this morning:
- Speaking of focusing on the right things, Ben writes about focusing on the LAST bull or bear market instead of focusing on what’s happening this time. It isn’t very helpful to try and fight a battle that has already happened.
- There aren’t many situations where a 401(k) loan is a great idea. But to say that taking a 401(k) loan is ALWAYS a bad idea isn’t true either. Blair comes to the defense of the 401(k) loan in her latest post.
- The terms risk and regret tend to go hand in hand when speaking in regards to investments. Morgan writes about how figuring out how much risk to take is trying to figure out how much future regret you may have.
- Bookending this edition of Top Links with pieces from Ben Carlson, but with good reason! Ben writes about the housing market and how it’s shifted over the years to the point where houses for sale for $200,000 are essentially non-existent.