We can’t all be high achievers. And some of us don’t want to be.
If I’m being honest with myself, I’m one of those people. And I’m not the most energetic guy in the world. If something really interests me, and captures my imagination, I will work on it night and day, and it will consume my thoughts. However, if it’s something I have to do, but I’m not really interested in doing, boy, do I struggle. My mind wanders, and the effort exhausts me.
For a lot of my life I compared myself to far-more-energetic friends who seemed to navigate their world with rockets strapped to their ass. Always running here and there, pursuing one interest after the other, never seeming to rest. These people got things DONE! Meanwhile, I tended to, well……‘putter’. Procrastinate. Lollygag.
But as I got older, I started to realize that I LIKED being this way. It suits me. I’m okay with it. Fortunately, I find my job pretty engaging, so I work hard at it, and I am motivated to get things done at work. But outside of that, I’m pretty slack, to be honest.
If you’re like me, how does being a slacker impact your finances? Can a slacker find a comfortable spot in the personal-finance world?
Being Too Slack Can Be A Bad Thing
When I worked as a financial planner, I saw the slacker mentality in my clients frequently. It was hard to get them in for appointments. They wouldn’t return calls. They’d ignore recommendations.
And I know exactly why they did this. It was because they didn’t want to engage. They often told me that they found financial discussions either dull, or terrifying, or simply too much effort to bother with. So it was easier to do nothing and assume everything was fine.
Unfortunately, for many of them, everything wasn’t fine, and being a financial slacker was only making things worse. In fact, for a lot of years I was in the same situation as they were. Not fine, but not really interested in fixing anything, either.
This goes beyond what I would call being a financial slacker, though. This really creeps into being financially neglectful. Financial neglect is a bad habit to get into and something no one should be proud of.
Sorry, But I’m Just Not Into You…
Although I learned to stop being financially neglectful some time ago, my status as a financial slacker extends to my interests, and even what I put on this site. For instance, I don’t really do a whole lot of technical writing on personal finance topics. And there’s a really good reason for this: I find it boring. I’m not into it. So I don’t spend a lot of time on it.
What I spend more time on is behavioral information, since that’s what interests me, and it’s where I see that the most value can be offered for average people. If your behaviors are right, you’ll end up in a good place. Technical information may get you there a little faster, but that’s probably about all.
For instance, what do you really need to know if you have a lot of high interest debt? You need to know that you have to pay it down, and lower the interest rate if you can. It’s super easy: pay as much as you can, and ask for a lower rate from your credit providers or get a consolidation loan.
If you can’t do that, complete a consumer proposal or go bankrupt and start over.
That’s all there is to it, really. You can argue the “debt snowball” versus the “debt avalanche” all day and night, but at the end of the day, you’re still paying off the debt, right? I’d much rather talk about why you got into debt in the first place, and how you can avoid going into debt in the future.
Slackers Can Take It Easy On Themselves – And Still Do Well
The above may sound like I’m rambling, but there is a point here: I’m a slacker when it comes to my finances, and clearly so are a lot of other people. What you don’t want to do is let that slackerism turn into negligence.
What you do want to do is take control of your finances in a way that minimizes the amount of effort you have to put in.
So, here’s my handy guide to being a successful financial slacker.
Slacking With Your Cash Flow
Let me guess: tracking all of your spending feels like a lot of work and the very thought of it leaves you feeling exhausted. So you can’t be bothered. And then you wonder why there’s no money left at the end of the month, right?
So make it easy on yourself. Set a fixed amount you can spend each week, and take it out in cash. When your wallet is empty, you know you can’t spend any more until next week. Easy-peasy.
If that doesn’t work for you, determine an amount you can afford to save off every paycheque and put it away in a savings or investment account as soon as you get paid. Then you can spend the rest of your money without worrying about it, either in cash or with your debit card. But leave the credit cards at home. They make it too easy to get off track.
No recording, no spreadsheets, no fuss.
More time for beer and naps.
Slacking With Your Debt
If you can put aside enough money to pay off your debt in a reasonable time frame, just knuckle down and do it. There’s no shortcut.
If you can’t see a way to get your balances paid out, a consumer proposal or bankruptcy is preferable to a lifetime in debtor purgatory. Pull the pin already.
One thing I did that helped me in my debt-reduction efforts is I left all of my credit cards and lines of credit open as I paid down, or off, balances. Many times, as soon as a balance dropped substantially, the issuer would send me a pitch to transfer a balance at a reduced rate. Typically, I’d be paying 2-5% including the transfer fee, for a year.
By carefully managing my payments, and transferring balances as appropriate, at one point I had dropped my total interest payments by 50%, while the balances had only declined 20%. All with just a few online banking transactions. And no embarrassing consolidation-loan application with a judgmental banker.
This is quite simply the easiest and least stressful way to reorganize your debt into lower-interest products, if you can make it work.
More time for walking the beach and pondering clouds.
Slacking With Your Investments
Don’t let anyone fool you, investing can be dead simple. Honestly, if you buy a cheap portfolio fund or portfolio ETF from a major manufacturer, one that’s appropriate for your objectives and risk tolerance, and you add to it regularly and hold it forever, you’ll do better than 90% of Canadians in terms of investment returns.
Having said that, if you read a lot of personal finance articles, you’ll find all kinds of people writing about dividend strategies and foreign withholding taxes and factor investing and sector rotation…etcetera, etcetera, etcetera. It’s easy to feel like you’re really missing out.
In reality, while all of these things have merit, it’s only at the margins. Sure you may do a bit better on your returns, or save a little on your taxes. But at what cost? Do you really want to spend time reading a bunch of dry financial reports, or pouring over spreadsheets and tax rates? Do you see yourself agonizing over weightings and exposures? Is that something you really feel like doing?
Further, some strategies, like buying individual stocks, can increase the odds of you blowing up your portfolio by making an error in judgment. Taking on extra risk while also adding work doesn’t sound at all like a slacker-friendly approach.
Really, these strategies are more appropriate for the investment hobbyist who lives and breathes this stuff, and is completely dedicated to squeezing every last nickel out of their assets.
If that’s you, fantastic. Have at it. But if it sounds like a total drag, don’t worry about it. You aren’t missing anything important. Buy a portfolio fund and hold it for the long term. You’ll get 90% of the results with 10% of the work.
More time for ‘Netflix and chill’.
Slacking With Your Life
Getting ahead, getting out of debt, and building wealth, all require self-discipline. You need to stop spending on the things that aren’t important to you, so you can focus your resources on the things that are. That’s very clear.
But to hear some people tell it, if you aren’t willing to sacrifice your entire life to the wealth-building process, well, you’re a loser and are doomed to failure. To these folks, unless you are willing to forgo coffee and avocado toast for the rest of your life, you just don’t want it enough.
But that kind of self-denial isn’t a lot of fun. It’s exhausting.
Now, don’t get me wrong, if this type of crackdown is the only thing that will get you out of a financial mess, then do it. It’s worth it. And more power to you.
But if your debt repayment and/or savings goals are on track, and you can afford the odd nice thing without totally derailing your plans, then go for it. Life’s short. Why put off everything enjoyable to a future date that goodness only knows you may never see? Have a coffee. Heck, have a muffin with it, if you want.
Just make sure that whatever you splurge on, it will add real value to your life, and it fits with the reasonable financial goals you have set for yourself.
More time for, well…..whatever you want, really.
You Can Be A Slacker, And Still Be Successful
The point of this post isn’t to encourage carelessness. Rather, it should encourage you to embrace the idea that a tendency toward sloth doesn’t mean you have to give up on financial self-improvement. There’s a shortcut for doing everything that will get you the majority of the results you want, without all the tedious effort you’d prefer to avoid.
If you know you need to make changes, but have been putting it off because it seems like too much work, just start with something simple. Go online and open a TFSA with your bank, and start a contribution of a couple of hundred dollars a month to an index fund or two. It’s not perfect, but it’s better than nothing. And it can be accomplished in mere minutes.
The funny thing is, as you see your situation improve, and you start to have success, doing more work on your finances may start to seem like not such a drag after all.
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The information above is for general informational purposes only and does not in any way constitute an offer for the purchase or sale of any security and is not intended to be considered comprehensive or personalized financial or investment advice. themoneygeek.info assumes no responsibility for the use or application of this information. Always consult a tax, investment, or other appropriate professional before adopting any new financial strategies.
I am an accredited Financial Planner with 23 years of experience in the financial services industry. During the course of my career I completed hundreds of financial plans and recommended and sold hundreds of millions of dollars of investment products. I believe that financial independence is a goal anyone can aspire to and I am passionate about helping others to live life on their own terms.