Financial Fitness Requires Consistency

by Paul R. Ruedi, CFP®

This week when I was struggling for column ideas I decided to take a break to get some exercise, which proves I will procrastinate by just about any means necessary. But of course during my workout an idea came to me: getting results in the gym and getting results from your savings are really quite similar. Both require long periods of consistent behavior, but people always look for shortcuts and set themselves up for disappointment.

If you exercise once every two weeks, you aren’t likely to get results. Results come from disciplined consistency and showing up several days a week, regardless of how motivated you feel. Physical fitness is not achieved in one big workout. It requires years or decades of consistency.

Saving and investing require a similar consistency if you want to get results. If you want to chip away at a monumental savings goal like funding a retirement, you can’t simply hope to save here and there when it is convenient. It won’t be done in a single year or lump sum. You will need to plan for years or decades of consistent saving before you notice any material progress towards such a big goal.

But consistency is difficult, so people are always tempted to look for shortcuts. Making matters worse, there are plenty of products and gimmicks out there to convince them of things we all know are too good to be true. In fitness it is the suspiciously short workout program, the miracle supplement, or radical diet.

When it comes to saving and investing, we have market timing strategies, gurus promoting options and day-trading, the hot investment fads of the day, and an infinite number of other get-rich-quick schemes. But you will notice in reality that nobody gets healthy because of miracle supplements, and nobody funds their retirement on fad investments and get-rich-quick schemes. There are no shortcuts.

Because both physical fitness and saving require discipline and years of hard work, people often burn out quickly when they fail to see immediate results. It is important you push through this and measure your progress over larger time scales. With physical fitness you can measure how much you can lift, how fast you can run a mile, etc.

When it comes to saving, it is easiest to measure your progress towards your goals over time using a financial plan rather than trying to make sense of a constantly fluctuating account balance. If you aren’t sure how to build a financial plan and measure your progress towards your savings goals, you may want to talk to a financial planner.

Paul R. Ruedi is a Certified Financial Planner™ professional with Ruedi Wealth Management in Champaign, Illinois.