About the author: Brearin Land is the CEO of Irvine Wealth Management and world renowned Brazilian Jiu-Jitsu Black Belt at the Gracie Barra Headquarters. He has combined his martial arts leadership with his knowledge of finance in creating the Black Belt of Finance Blog.
You are freaking out. When you aren’t pacing around the mat waiting for your name to be called, you are pacing around in your head. “Oh my god, please do not get submitted in front of my friends.”
You are not alone, not only have I seen this fear first hand from myself and my students, but I see a lot of the same fear surrounding my clients as a financial advisor. They get so overwhelmed about by their financial situation that they keep putting it off until later and become complacent.
Here are a few lessons in the gentle art of saving money that I learned from competing and that I apply with my clients everyday.
YOU HAVE TO PUT IN THE TRAINING
Look you’re always going to have gitters. Even at the highest level there is an element of pride and vanity that even the best of the best have a hard time shaking. The key to controlling the nerves comes long before fight day. It starts in training.
This was certainly the case for me when I started competing. Was I nervous? Of course I was! But what I realized after the tournament was over was that the bulk of my nerves were not as a result of the opponents I was set to face, but from knowing in the back of my mind that I did not do as much as I could have to prepare.
In personal finance it is no different. Whether you are trying to climb out of debt, trying to get into the habit of saving, or simply getting a handle on your investments, the first step is to meet the problem head on rather than running away from it.
It is scary just how many people I meet who, for example, have no idea what is inside their savings plan. Financial downturns like the one’s that took place in 2001 and 2008 left investors scratching their heads asking what went wrong. They soon realized they also did not do enough to prepare.
CHAMPIONS ARE NOT COMPLACENT
One of the things that I learned from competing is just how hard it can be to cut weight. Since I had never been exposed to it before training Jiu-Jitsu all I had to go off of was the experiences of others, but the difficult part was being disciplined enough to follow through with their advice.
Anyone can put a diet together. But day after day and week after week of being hungry and avoiding the late night meals became a difficult task for me as a noob. The few too many cheat meals I had later cost me the flexibility to eat much of anything in the days leading up to the events.
Whether it’s dieting for a competition or saving for financial independence, slow and steady really does seem to be the winning formula. Why then do the overwhelming majority of folks get it wrong?
Our baby boomers (currently retired or contemplating retirement) for example:
- Median retirement savings for a boomer age 55 to 64 is just over $100,000
- Median retirement savings for folks between 65 and 74 is just under $150,000
If these individuals were to make a pension out of these retirement funds using an inflation protected annuity, their savings would amount to a monthly income of only $310 and $649 respectfully .
If you’d like to live in a trailer in Kincaid, IL (my home town) you should be fine, if not, you’re probably in trouble.
30% of these individuals who are 55 years and older do not have ANY retirement savings OR a pension to draw from.
And the outlook for our Millennials and Gen-Ys are not any better with almost 70% of individuals not taking part in their employee sponsored retirement plans .
Inherently we know there’s a problem and we understand that whether it’s saving early for retirement or being disciplined in your diet leading up to competition, the key is to get after it early and often.
Taking care of these issues early on means not having to be so hard on yourself down the road and in turn you are able to let stress take a back seat and focus on what is important.
HAVING A SUPPORT SYSTEM IN PLACE
One of the greatest contributors to calming my nerves on fight day was having someone to go along the journey with. When I first started competing I had no idea what I was doing.
I was completely green to the idea of cutting weight so not only had I not got started as early or as often as I should have, I was stressing out about the weight and I didn’t really have any experience to pull from to get those last couple pounds off.
Luckily I alway’s had a team member to fall back on for experience, or if nothing else, I generally had another friend cutting weight along side me.
In the realm of finance I’ve been lucky enough to work with not only the friends and families that I share the mats with, but literally dozens of high net worth clients here in Orange County.
One of the key differentiators that I’ve found that the wealthy do differently is they ALL have a plan in place and they are not going along for the ride alone. They have a CPA, an Estate Planning Attorney, and a Financial Advisor that work together to take their finances to the next level.
These are all resources and systems of support available to you regardless of net worth.
FINDING THE PATH OF LEAST RESISTANCE
Everyone’s heard the term buy low sell high right? It seems like such an easy concept to understand. Why then during times of financial crisis like we had in 2001 and 2008 does everyone tend to do the exact opposite?
Well the reason is that investors, when left to their own devices, are inherently emotional in their decision-making. When the market plummeted we saw people losing 30,40, even 50% of their nest egg.
Many people had to hold off on retirement, many people were forced to go back to work, and many more were simply out of luck financially.
Their first mistake is what got them there. Poor decision making in their portfolio allocation meant that what they thought was there risk tolerance did not match their true appetite for risk at all.
Their second mistake is what kept them there: They let their emotions get in the way of the elementary rule that we talked about earlier: buy low, sell high. By selling low and buying high many locked in their losses and made the road to recovery twice as difficult.
In the tournament, especially as a beginner, we fall victim to the same emotional mistakes and let our emotions take control of a match. Look around next time you are at a tournament.
Take a look at the white belt division and notice that you can often pick out the winner of the division before they even shake hands; not by how big they are or how strong they are but how they carry themselves when they step out on the mat.
Now again, everyone going into the match has a high level of nerves (especially in the beginning) but it’s the ability to channel that fear and channel that nervous energy that ultimately decides the victory.
HOW HAS COMPETITION CHANGED YOUR LIFE?
Each and every day we step out on the mat and go through the meat grinder we are met with obstacles and life lessons that end up going far beyond Jiu-Jitsu. We call this the BJJ lifestyle, do we not?
This lifestyle fosters healthy diet and exercise. It molds the way we treat our friends and family. The long term affects of Jiu-Jitsu mold us into better friends, parents, and mentors… Don’t forget to let the lifestyle take you to the next level financially.
If you have any questions about the article or even your financial situation just leave a comment below or contact me directly at Bland@irvinewealth.com
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