Financial Lessons From a Rugby Field
December 11, 2015As I write this, I have clothing in the dryer and when it’s done, I’m throwing some of it in a bag and hitting the road. The university where I played rugby is playing in the college national championships this weekend. Some of my old teammates are the coaches and I’m still involved with the team in various capacities. I will probably be watching game tape of our Saturday opponent in the round of four and if we win (yes, I still say “we” when talking about a group of college kids playing rugby), I’ll spend part of Saturday night breaking down tape with the coaches for our Sunday opponent in the National Championship game. I’m pretty excited and can’t wait to hit the road to see the boys play with the prospect of a national championship trophy in reach.
I pretty much have a one track mind right now and it’s 100% about the game of rugby. But it turns out that discovering this silly game and playing it for a long time has helped shape my financial life as well. Some things I learned on the rugby field that are useful in my “real life” (as if rugby isn’t real life…) are:
Rely on your teammates! On the field, where each team fields 15 players, if I tried to freelance or do too much or play selfishly (not involving my teammates), I would have 15 opposing players waiting to hit me – hard! On the field, I absolutely needed to work with my 14 other teammates and trust them.
In my financial life, I have to trust and work with my financial planner. Yes, I have one! After talking to people all day long about their financial life, the last thing I want to do at home is look at my own, so I have a relationship with a planner who reviews my financial life and I review his so he doesn’t have to after his day is over either.
I also have to trust my homeowner’s insurance agent, my auto insurance agent, my life insurance agent, my real estate agent and my mortgage broker. When I got divorced, I had to trust my attorney to update my will and healthcare directives. I probably have as many “financial teammates” now as I had rugby teammates during a game. I have to talk with each one just like I talked to all my on-field teammates to make sure that our strategy is where it needs to be, our tactics are in line with goals and that we know where we are headed. It’s virtually impossible to do everything on your own, so find excellent teammates and trust them to do their best job (while maintaining an oversight role, so you don’t get Bernie Madoff’d).
Sometimes we win and sometimes we lose. I’ve played on great teams and I’ve played on bad teams. All of them won and all of them lost.
The thing that made the great teams so much better wasn’t necessarily the talent level on the field. It was mostly mental. After a win, we didn’t celebrate for more than a few hours. After a loss, we didn’t sulk for more than a few hours. We moved on to the next opponent and focused on the next task at hand.
I’m seeing too many people right now who are panicking because their 401(k) value is lower on their quarterly statement than it was on the last statement. After 6-7 years of straight up growth in the stock market, too many people forget that markets go up and markets go down. They want to make radical changes to their investment strategy because they had one bad quarter.
I don’t know if the markets will go up or down in the next quarter, but I can say with virtual certainty that over the next 10 years we will have many good quarters and quite a few bad quarters. Expecting to win some and lose some can help take the over-reaction out of investing. My philosophy/strategy on investing – “pick a strategy and stick to it in good markets and bad.”
It’s not that complicated. I have a top line stocks vs. bonds vs. cash asset allocation that I believe is right for me, and I stick to that allocation when the market goes up and when the market goes down. I also re-balance automatically so that my top line allocation remains relatively consistent.
I am a hands-off investor with this strategy. Pick your strategy and stick to it. Don’t let one loss make you rethink everything.
In the end, it’s just a game and what really matters is the relationships. My college teammates are some of the best friends I have to this day. The guys on the field Saturday and hopefully on Sunday will form lifelong bonds out there.
Not to get too sentimental, but there have been times in my life when things have been really rough financially. There have also been times when things have been pretty darn nice financially. Not being defined by your financial situation at any moment in time is a very important skill to learn.
I meet with people who come in for a financial coaching session and the first thing they tell me is “I’m horrible with money.” When I hear that, I immediately stop the meeting and let them know that they are NEVER allowed to say that again. That message has to be removed from their mind.
I re-frame it and ask if they have good relationships with friends, family, coworkers, etc. Almost always, they say yes. I then let them know that they are creating a new relationship today with money and that relationship can be a good one, just like the other ones in their life.
It’s a bit silly or corny, but I think that re-framing that piece is critical to the success of some of the people who once told me that they are horrible with money. In follow up sessions, I ask how their relationship with money is going and they laugh, knowing that they would not be met with a smile if they said they were “horrible with money” still. Think about the relationships in your life and if it makes sense for you to frame your relationship with money in a new way.
The dryer is now finished and I’m getting ready to pack my bags to see a great weekend of rugby. I’m even taking my cleats and mouth guard just in case the coaches think I’ve still got a good 30 seconds of play left in my body and let me sneak onto the field and test how good the medical staff is after a 20-something year old super athlete destroys me. Think about the things in your life that shaped you, much like my rugby experiences have shaped me. What lessons can you take from those important stages of life and make a part of your financial life?