Salute Your Earlier Self – The Human Side Of Money Presented By Client Care

by admin | Jul 1, 2025 | Financial Planning, St Francis

In theory, being a successful investor is easy. Spend less than you earn, invest the difference for three decades, and draw down what you need in retirement. The education, resources and tools needed to do this have never been more accessible. We’re practically drowning in information.

In practice, however, being a successful lifetime investor has never been more challenging. An abundance of investment options, breaking news delivered by phone notifications, and direct access to the competing views of “experts” mean that it’s no simple task navigating the journey from your first paycheck to your glorious financial independence day.

A few simple actions can reduce the noise you are exposed to, placing the odds in your favour. However, the greatest challenge you will face as an investor is one you cannot run away from: the emotional turmoil of living through a never-ending series of world and financial crises.

Is It Different This Time?

Benjamin Graham (the father of “value investing” and mentor to Warren Buffett) acknowledged the root of the problem over seventy years ago.

“The investor’s chief problem, and even his worst enemy, is likely to be himself”.

Whilst we’ve largely solved the mathematical element of the investing challenge, no one has yet solved the emotional part. We propose that no one will.

The behavioural challenge of acting rationally under uncertainty feels like it has been exacerbated by many of the developments we generally consider to be positive. The ease at which we can access information and near-zero transaction fees are benefits that have their downsides.

Salute Your Earlier Self

We know in theory that patience and discipline are required for investment success, but knowing something is not the same as experiencing it. In the middle of a global crisis (we’ve had many recently), being disciplined is easier said than done. But this is, and will always be, the defining characteristic of successful investors.

Whilst each crisis has its own name (Covid 19, Ukraine, Cost of living crisis) and its own unique characteristics, they all build-up to the point where it forces you to ask the golden question:

Is it different this time?

In this moment, your human side is screaming at you that this time is indeed different. How could it not be given how distressed you feel.

However, at that moment, your future self needs your present self to have the clarity of mind to acknowledge that while each crisis comes by a different name, they are essentially all the same.

Whilst we can’t prove anything about the future (after all, there are no facts about the future), we can look to the past and marvel at how resilient both humans and markets have been through every type of crisis. How is each crisis the same? The fact is that they are unlikely to matter in three decades. In fact, you won’t remember most of them in three years’ time.

You’ve Done This Before

You do not have to accept the above only in theory. You have your own unique history as an investor, and you have likely withstood many emotional challenges in the past.

If investing is more behavioural than intellectual, reflect on your past self’s good behaviour during difficult times. Investing is not one long cognitive challenge but rather a series of intermittent behavioural challenges.

It has been said that a successful investor’s career is akin to a pilot’s career – long periods of utter boredom punctuated by a few moments of sheer terror.

When the next test comes (its name is as much a mystery to you as to me), take courage from your past self’s actions. There will be more to come. Stand firm. This time is never different.

Understanding the essence of the investing challenge, we see our role as standing guard between you and the few decisions which could derail your financial future. We call these the big mistakes. Please know that we are always available to you and understand that the emotional challenges described above are ones we all face.

Man Isn’t “Wired” For Retirement.

by admin | Jul 17, 2023 | Financial Planning, St Francis

Nowhere in the bible is the word or concept of retirement mentioned. The first recorded use of a state pension was in 13 BC by Augustus Caesar for military veterans who had served at least 16 years in a legion and 4 years in the reserves. This was later increased to 20 years in a legion and 5 years in the reserves.

Apart from this instance, retirement was a foreign concept, and normal people worked until they died. This changed in1881 when Otto von Bismarck, the conservative minister president of Prussia, presented a radical idea to the Reichstag: government-run financial support for older members of society. His idea was ratified 8 years later and provided for citizens over 70.

In the USA, the Social Security Act was passed in 1935, and the official retirement age was 65. Life expectancy for American men was around 58 at the time.

Retirement is a man-made concept and was never meant to cater for living decades after stopping work, as is now common. The obvious issue around this is the finance needed to support the ever-growing generations of non-income earning citizens.

As mentioned, finance in retirement is an obvious concern that needs to be provided for, but what is often not considered is the human element of this transition. We work our whole careers, getting more skilled, experienced, and wiser, and then one day, after a specific birthday, we get tossed out. Consider all the knowledge and human capital that is lost. Consider even more the change one must deal with when this transition is forced upon us.                                     

For many, our work represents or defines who we are; it gives us purpose. It is unsurprising that the biggest challenge retirees face is finding their purpose in retirement. 

At Client Care, we understand that retirement requires rewirement, which does not happen by chance or overnight. This new phase of life is a goal from the day we start work, we often have 40 years to prepare for it, yet most of us only consider the financial aspect of this transition and neglect the human side.

Addressing the human side of retirement is vital if we want to live our best lives. The only way this can be done is with specific planning around creating this future life. Yes, we need the funds to live the way we want, but all the money in the world can’t guarantee a successful and happy retirement.

We help you find purpose for your money and your life.

—

Dirk Groeneveld, Certified Financial Planner

t. 083 261 9287

e. dirk@clientcare.co.za

web. Client Care Lifestyle Financial Planning

Previous Columns:

• Are You Living Your Best Life?
• The Only Return That Matters Is A Real Return.
• Building A Social Life After Relocating
• What’s More Important Than Investment Risk?
• Risk Cover: The Grudge Buy
• The Benefits Of Not Going It Alone
• Three key questions to ask yourself if you are considering retirement.
• Don’t Leave Your Retirement To A “Rule Of Thumb”.
• * The Difference Between Being Rich and Being Wealthy