My strong point
While my day job is a financial advisor, I am an avid chess fan. I remember a recent chess game I played with my chess coach, Boris. He played white, and opened the game with e4. I had numerous responses for that move. Instead of responding to his move with an opening I knew, I used the Sicilian defense, an opening I was less familiar with. Needless to say, I lost the game very quickly. I should have stuck with what I knew and was good at.
Why you should do the things you’re good at in the investing world
Apply this tactic of focusing on your strengths in the investment world.
A few weeks ago a client came in with his wife to make a financial plan. Though he earned about $300,000 a year, he was still constantly in debt. He walked into the office a few minutes before his wife to tell me that during the meeting I should tell his wife to stop spending so much money. Ultimately, during the course of our meeting, it turned out that he was the big spender!
I suggested they see a professional to help them with their budgeting and keep spending under control. But as he was not interested in budgeting or cutting back his spending, we had to find a different solution.
Two ways to get rich
The two ways to get rich are to spend less or earn more, so I suggested he started making more money. As he is a hard worker and good earner, we found a solution that utilized his strength of working hard. Since he was good at making money, we worked out a way to leverage that strength rather than focusing on his budgeting weakness.
How could I play openings I am good at in the investment world?
Just like in chess, where it is important to play tactics you studied in the past and know all the different development variations, in investing it is important to walk in familiar territory. As an investor, you are often on the responsive side. You get to choose your response to the market situation, just like a chess player playing black can choose the opening he wants to play.
There are many different skills in the investment world, many of which could make money. Some people are good real estate investors, while others are better at trading stocks. It is important for you to focus on your strengths.
Admitting weakness takes strength. Realizing a weakness in a particular area and working actively to fix it is a tactic that takes humility, too. Hiring professionals in fields you are less good at has a double benefit. It does not only leave you time to focus on advancing your strengths, building your business, or improving your investments, but it is also beneficial for you to get professional treatment in your less strong areas. Surrounding yourself with a team of people whose skills complement each other gives all the players a chance to do what they are best at, and leaves you time to do what you are best at too.
What are your strengths? How can you apply them to improve your investments and build your business?
Click here to listen to the inspiring story of how Susan Polgar used her strengths to overcome the chess establishment to become the first female to earn the title of “grandmaster.”
Douglas Goldstein, co-author of Rich As A King: How the Wisdom of Chess Can Make You A Grandmaster of Investing, avid chess fan, international investment advisor and Certified Financial Planner (CFP®).
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