When we walked down the next morning to leave for school, all the stuff we shopped for would be sorted, the children’s numbers inked with indelible ink on their uniforms as required by the school’s dhobi, ironed and packed into suitcases that neatly stood by the door. All checklists for school had been ticked off and breakfast would be on the table. The car would be fueled and parked on the porch. The husband always woke up at 4am and he was a master organiser of stuff and lists.
We do not appreciate diverse skills enough, I sometimes think. We get quite absorbed with what we can and cannot do. We may dismiss or deny what does not come naturally to us. We may routinely overestimate our ability to manage our tasks. We may even pride ourselves as being self sufficient. But we may be missing the benefits from looking around and seeking help with things we may not be good at doing. That might ease the burdens of our lives. Or as this column’s focus requires, save us from our money lying idle in the bank, tax returns not being filed in time, or insurance policies not claimed when mature.
Open a worksheet to a class of junior salesmen and that is enough to put them off. Leave a chartered accountant with a complex worksheet filled with rows of numbers, he will pore through it and have it corrected for errors in a few hours. One set dislikes numbers; another thrives on it. It is commonplace in offices for some to claim reimbursements and submit vouchers in time and in order and for some to postpone it for ever or worse not care enough to claim what is due. Some like paperwork; some simply don’t.
Our money lives can be much better off if we are able to see where our skills lie and where we may need help. We may do much better if we are willing to include and take the help of others who can bring in the diversity of skills and attitudes our money requires. It is now common for a couple to manage their own money. There is enough evidence in literature about the differences in attitudes towards money that men and women exhibit. In a crisis, the man’s instinct is to act, while the woman chooses to wait; in a portfolio a man’s instinct is to churn; a woman’s is to hold for the long term. We don’t have to generalise to make the point that the money might do better with both attitudes than being driven by one of the two.
Are we able to make a complete list of strategies, tasks, actions, reviews and reorganisation that our money requires? Can we find out how we can do better if we involve someone with better skills so that these tasks are better accomplished? Investment groups and circles are a good example of thriving from diversity. A set of investors come together to discuss investment ideas. They talk in great detail; analyse numbers in depth; consider the investment from all angles and then make the decision. The diverse composition of the group contributes to the quality of the decisions.
Many of us have a favoured uncle, a close friend or a trusted colleague on whom we lean on for advice. We know whom to go to when the credit card bills look too big to pay off; we know whom to ask before making the decision to upgrade to a bigger house; and we know whom to call if we need to choose between competing products. We all thrive from these networks. Of real people who can earnestly help, if we care to ask. The illusion of friendship and advice from broad brush social media platforms might be inferior to specific advice that comes from people who actually know us.
That may also be true for paid services. There are service providers who specialise in specific tasks. They enable us to work more efficiently with our money, our savings, our taxes, our investments and our paperwork. We may be better off utilising their services when our money suffers from our lack of focus. We spend a disproportionate amount of time earning and spending money, and fail to give our investments a deserving amount of attention. A financial adviser can help channel our savings to fund the long term financial goals we set for ourselves. A trained distributor may help us choose and execute investment decisions and take care of the processes. A chartered accountant can track our incomes, keep our asset accounts, help us keep our advance tax schedules, and file our tax returns.
We find it difficult to share, discuss and open up about our financial lives to others. But sometimes we may need just the skill the other has. A bad credit situation might push us to inaction, overcome as we are by guilt and shame. A credit counselor can work with the bank and hand hold us out of the mess. A good financial adviser can stop us from making wrong investments decisions and keep us on track through the ups for downs of the market.
We may like the do-it-yourselves approach to our lives and finances. But rarely do we hold all the skills and attitudes required for the task. We may have the right information and intent, but suffer inertia when it comes to action. Notice how we can find other’s faults easily; or care for others in the family more than we do for ourselves. Everyone benefits from an outside pair of hands and legs. Diversification helps both the money and the man.
(The writer is Chairperson, Centre for Investment Education and Learning)