I took up golf many years ago in order to entertain clients. I found spending four and a half hours on the golf course was a great way to build a personal relationship with them. I never dreamed I could find time to play for pleasure or that I would even enjoy the game. Today I don’t know what I would do without golf to occupy a significant portion of my leisure time.
I quickly discovered many parallels between golf and managing my personal finances and investments. Like golf, investing and personal finance can often be an elusive challenge for many people, but it doesn’t have to be. Consider the following guidelines and you’ll have a much greater chance at success with both.
Be patient and persistent
Consistent improvement with your golf game takes time. I can’t count the number of times I’d practice diligently on my swing and start to see some improvement, followed by a series of bad rounds. Believe me, sometimes I wanted to throw my clubs into the nearest pond. But players who really improve don’t give up but continue to work on their golf game.
Just like the markets, there will be lots of ups and downs, and you may want to quit. A really bad day of putting can be quite humbling. Just remember, you can’t grow if you don’t play the game. It will be worth your while to stick it out.
Belonging to a golf club or playing the same golf course a few times can improve your scores. Knowing where to aim to avoid obstacles and hazards can reduce penalty strokes. Remembering mistakes in club selection can also help improve your golf scores. (Should have hit my 8 iron on this hole)
As an investor, I spend lots of time researching the different markets before selecting my investments. Like golf, constructing or re-balancing my portfolio requires avoiding making costly mistakes in my selection process.
Bad shots are part of game
Accept the fact that you are going to make some bad golf shots. Even golf pros miss hitting some fairways & greens, they even take penalty strokes. Every investment has some degree of risk, sometimes you just have to take the loss. Both golf & investing requires managing your expectations, you are going to make some good and also some bad investments.
Play your own game
I think the most important lesson that golf teaches is to play your own game. Play according to your skill level and make the shots that you know you can make. Trying an impossible shot like hitting out of a hazard may only result in taking more strokes. Taking a penalty stroke maybe a better option. Too often, people let the performance of others affect how they play their own game.
Take lessons or hire a coach
Is it possible to learn golf or investing on your own? Absolutely, but I have taken a few golf lessons and I have also worked as a financial advisor. Some golf lessons have improved my game while others have resulted in poorer scores. Unfortunately, not all professional advice in either golf or investing are created equal. Finding the right professional at a reasonable price could help you avoid some disastrous mistakes.