Episode 36: The Biggest Mistakes I Might Be Making with My Finances

ABOUT THIS EPISODE

On this episode of the Build Your Life Podcast with Financial Expert John Browning, we're discussing the biggest financial mistakes you might be making (without even knowing it).

Tune in today to hear John share all about mistakes you could be making when it comes to your financial planning. Some of these mistakes include: impatience, desperation, lack of diversification, and many more. Listen in for advice on how to create a plan for success!

For more information, visit www.GuardianRockWealth.com to learn more about what John can do for you. Or, give us a call at (312) 372-5000.

Welcome to the build your life podcast with John Browning. Build your life as a relaxed and unedited conversation with financial expert John Browning. John's the founder of Guardian Rock Wealth, with offices in Hawaii, Colorado and Illinois. John's also the author of the book build a life, not a portfolio, a guide to your financial future based on your personal values, which you can purchase on Amazon, or stay around to the end of today's show and I'll tell you how to get a free copy mild right to your door. I'm Michael D Lan, your host for the next few minutes as we chat with financial expert, business owner and author John Browning. John Browning, how's your day going, sir? Maybe is going fantastic, beautiful sunshine and just a great day so far. Well, that's great. I can concur with that. We have sunshine this week. Last week it was nothing but rain after rain after rain, which was really interesting, and but it was good because my grass...

...went from being Straw to being grass again. So well, that's good. It's good and then looks better when it's green. It really does. The neighbors appreciate it. So that that I want to talk today about mistakes and some of the mistakes that people make that they may not even be realizing they're making as they're putting together a financial port folio. There's just a lot to it and you help people do that all day every day. You help them build a life that's backed by and supported by their portfolio. But in your book, I remember somewhere you wrote about mistakes and different things. So let's that's what I want to talk about to day. What do you have to share with this? Well, this is a this is a topic that is near and dear to my heart because I've made so many of them and really it's what experience is made of. Right. There's I think I mentioned this in the book too. There's a there's a difference between having the right experience...

...and and sort of somebody who's gone to work and done the same thing every day for thirty years has the same exp same day of experience or same year of experience for the past thirty years, over and over yeah, and over and over again. One of the things that I've been and didn't seem like it at the time, but really blessed to have happened to me, is I've had a lot of different experiences over the past thirty or so years of my life and then investing, and what that means really is that I made a lot of mistakes. Yeah, and I've learned what those mistakes are and I've learned the questions to ask. But but to your point, there are some pretty common mistakes and of course we'd be here all day if I if I talked about all the different mistakes that you could make sure, but there's some really common ones and some of them are perpetuated by the media, what you hear on TV, what you read on the Internet. One of the things that is happening today in particular, during we're in the middle, I...

...don't I hope we're in the least in the middle or hopefully on the last, last side of it, this pandemic that is lingers on. And with that there's this strange phenomenon that has happened, and this happened has happened before, where individual investors, they've got a little bit more time on their hand and there maybe just a little bit concerned and getting a little bit, we'll call it, maybe, desperate, and they're looking for answers. How do I make money? How do I feed my family and I have seen so many advertisements coming out about how to make a thousand person in two days or whatever the advertisement is, and you know, just I'm just going to say it, that is not possible. Okay it. The only way that's possible is if you get lucky. No skill is going to generate that on a consistent basis, and so one of the big mistakes that people make is getting...

...desperate, getting emotional and and buying in literally sometimes to the training or the idea that they can actually do this themselves and make big money in the market. And it's really a horrible thing for me to see, because you're also seeing many more of these free online trading and the councilor being opened up in the hundreds of thousands new accounts every single day, and so doing it yourself without understanding the risks involved is probably the single biggest mistake that we see. And that's good, and correct me if I'm wrong, John, but what what came to me is you were talking about. That is the the underlying current of Greek really I want to thousand, I want I want to get...

...rich, quicks game to get me out of my situation or something pursuing that is always a mistake, right and versus having a long term plan and things, but that's what came to me when you were saying that these yeah, it's really a combination of that now. I mean there's always been the you know, the whole greed and I want all this money right now, but there's also this desperation that's creeping into people's mindsets now because of this odd situation in history, you that we're in, and that's what the kind I feel sat about that. And you know you use well meeting people that are just getting to the point where they're desperate and they're looking ahead and they don't have much further to go before they're literally and lose the house, maybe not even have money to buy food, certainly not to utilities and all that, and then they go into essentially it's gambling and and then they lose it faster. So it's a it's a real problem right now again in this unique time in...

...our history. So you've got both sides of that, the greed and the desperation sneaking in there. So I think that, yeah, the desperation. I not really thought about desperation and that plays into in the and with the desperation, probably a lack of you lose hope or you start losing hope, and that would drive you to take those risks. Try to be agree maybe. Yeah, that's interesting. The desperation. Yeah, and I've even seen it with you know, you know, very intelligent, smart individuals. When you get desperate, you start not thinking clearly. So well, and all the more, all the more reason, John, when you're not thinking clearly, is to have a third party like yourself that can help you bring a clarity, because when your clients stop of thinking clearly, hopefully they're picking up the phone and St John, we need to sell, and you're saying,...

...let's talk. What's the plan? WHAT'S THE LOT? Right, right, so having having a third party like yourself to get us through those ups and downs because, yeah, we're in the miss of a pandemic. It won't be the last. Something else is going to happen, right, and so you've got to have a plan. You got to have that. What we're going to talk about in an upcoming episode, that Comprehensive Financial Plan that encompasses, well, we shall I say, everything in life. It's not just the finances, it's all about building that life that you really want a life that is not filled with greed or desperation, because you've planned well and you have an overextended yourself. All of that plays into the end of the picture. But having somebody like you done that, they can reach out to that you mentioned a couple of episodes ago. You talk with your clients regularly and in your you send out emails to your clients and your that voice of reason, I guess, is what I want to say. Right. Well, I tragedy, right, that's the idea. Yeah, well, and and...

...that's good, very much like your mom was a voice of reason for your yeah, we all need that, especially when we're in situations like this when, if we're listening to the news all the time and reading the newspapers of the magazines or the Internet, you know, the world is crumbling around us and that causes us to be desper I like that war. That's a very good word to describe how people are feeling right now, and instead of being desperate, they need to feel at peace and confidentt and that comes when you have a financial plan in place, right, that's right, and and knowing what comes next, even if there's a detour along that Road Map, knowing what you're going to do when that detour comes off. And that's one of the other mistakes that people often make is I'm just putting away x number of dollars every month at all. That's good, that's that's a good thing, but not understanding what the plan is behind that, and so it's not working...

...as efficiently as it could. So that's another very, very common mistake. If I just put away fifty dollars a week or a hundred dollars a month or whatever it might be, then I will it'll just happen miraculously right that I'll suddenly end up with everything I need in retirement or whatever my goal might be. HMM. Another common mistake, probably one of the bigger mistakes that we see, is not being diversified enough. So and that can creep in there because there's been so much in the news and really smart people saying that, well, you just invest in the index and everything will be fine and what like. What I've said this before, I I believe, is that right this very second, you look at the SANP five hundred, which is the most common index that that people look at right now. Okay, describe the market twenty five percent of that index right now is in five stocks,...

...not five hundred. Five wow, and they're they're the big ones and they're growing really, really fast and and that's great, right. And that's where you've got a question whether or not you really want to be beating or even meeting the index, because at some point does that party end? You don't know. I don't know. They're they're great companies. We like those businesses, but do you want to be that overweighted to it? And most people don't realize that they are the same thing, by the way. They'll say, well, that's okay. I own the S and P five hundred index and I also own the NASDAC one hundred, which is more geared towards smaller stocks and technology stocks. And guess what, those same five stocks make up about a third of the NASTAC one hundred. So if you buy both of them together, you just increased your whole things in those so you may not...

...be as diverse fight as you think that you are. That's fascinating. That would be worth a podcast in and of itself to talk about diversification and things like that, because I would never have thought about that. Of How you're old, you're overlapping, but really you're buying the same stocks, right, and if those five companies of something that should happen to two or three of them, guess what's going to happen to your portfolio, which is that's going to affect your emotions and you're going to become desperate, and that's fascinating. I like that. That would be a very interesting topic about how not to make the mistake. All Right, I guess you know diversification is probably a good thing, but you knowing what you're diversified in and how it all plays out, and that's why you know. You, John And Guardian Rock. Well, I mean yes, study this stuff, you know all these things. If you would have asked me, if we take a poll of our listeners I met, none of them could have told you what you just said. It's possible. It's possible. It's not something that I just everyone knows, but I live it every day and sometimes I take it for granted.

But most people just aren't thinking about that because they're doing what they do and they're living their lives. All the more reason to have you, John, helping build a life of portfolio, because I love what I do, John, and you love what you do. I don't want to do what you do, most people do. I think that's how most of your clients probably are and that's where that that trust comes in to get to know your clients. And you're not like the big houses where you're dealing with hundreds of thousands of investors. You're more like a small Hawaiian, little coffee shop, right, your clients coming in and you're talking with him, you get to know them, you probably greet them by saying a lohall and but it's understanding your clients hell and in helping them navigate, whether it's a pandemic or whether it's a kid going to college or whether it's you know what, I want to retire in three years, John, how am I doing? Am I am? I close and you can help them navigate that, to help them build...

...a life that's full of peace and and whatever they want, whether they want to travel the world or just sit in their house and give the missions, or what's their dream. And then you bring to bear all of your mistakes from the past, right that you've learned from and in your your knowledge and your wisdom, to say here's how we get there and it's going to be okay. Right, that's that's the beauty of it. So let me let me just encourage you to reach out to John. He's got a book called build a life, not a portfolio. You can get a copied as website, Guardian Rock wealthcom. You can also schedule a all with John there. You can email them from there and you can talk about these things about, you know, how can you get through life and in retirement, that I want to talk about in another episode. John some of the maybe some of the pitfalls and retirements, some of the things with taxes and different aspects. But being able to put those plans in place a few years before you hit...

...retirements really important and John can help you navigate all of that and have discussions around how to build your life the way you want it to be. And not only is the excellent at financial advising and financial planning, he's a great guy, but he asked him really penetrating questions that make you really think about why do you want that? We talked a couple episodes about about, you know, how to be a millionaire. Why do you want to be a millionaire? And you may not you may not need that there may be other things that are more important to you, and John has these questions and relationships with his clients. To reach out to John Guardian rockwealthcom and learn about mistakes you shouldn't be making, and you can read about them in his book. So, John, thanks again, man for another great episode on mistakes and I look forward to talking with you next time. All right, sounds great. We'll see you next time. Bye, bye, AE bye. So thanks for listening to the building your life podcast with John Browning. Be Sure to subscribe to this podcast so each new episode will be sent to you automatically...

...when it is released. Have a terrific day.

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