Exploring TNT, patience, and market timing

Welcome to the Intentional Dollar weekly newsletter — great work taking this small step to move your money forward. I’m Logan, a Certified Financial Planner™, and I’m excited you’re here!

What’s inside?

• One tool to experiment with

• Two quotes from others

• Three questions to dig deeper

• Four lines of poetry for the point

_{One tool to experiment with:}

TNT

How often do you defer tasks to “tomorrow?”

“I’ll set-up my 401(k) tomorrow.”

“Eh, things might be tight this month, I’ll start the budget next month.”

“Maybe when the car is paid off I can save for retirement.”

Notice a trend?

All of these are examples of deferred financial living. The problem is that when “tomorrow” comes, we defer again. This cycle persists to our disadvantage. Time value of money tells us a dollar today is worth more than a dollar tomorrow. We know this is true because the dollar today can be invested and accrue interest, today. We also know inflation erodes our purchasing power in the future.

This is why it’s critically important to start as soon as possible — no matter how small.

And — small starts are preferred to large starts. Here’s why: when you start small, you reduce the friction of performing the action. Saving $10/week feels easier than saving $100/week. Starting small also allows you to remain consistent, which is crucial in compounding for long-term rewards.

Lawyer and running coach Jeff Cunningham says, “It’s more important to be consistently good than occasionally great.” This idea fits in finely with our finances. We don’t need to wait for the tax refund to save. We don’t need the bonus to get paid out to fund the 401(k). We don’t need to have at least $100 to start a savings program.

We need small, consistent money habits that we start today.

This launches us into today’s tool: TNT. TNT refers to an explosive ordinance, but the true name, trinitrotoluene is not common parlance. For that reason, and for this tool, we are redefining TNT to mean today not tomorrow.

Today not tomorrow (TNT) is all about getting yourself to immediately take action on the things you need to do. The same friction you feel today will be there tomorrow — you just don’t feel it yet.

The challenge for this week is to write down the areas of your finances you’ve been deferring. Take TNT to those areas and eliminate them. You have to be attune and self-aware to find these blind spots, so ask yourself, “Where have I been deferring to “tomorrow” in my financial life?”

I urge you to make take these small steps today because they are worth far more today than tomorrow. Investing is enlisting financial markets to shoulder the burden of growing our dollars — why not lighten the load now?

Time amplifies good action, so start today.

Here’s a list of common “tomorrow” deferral debates — my counterpoints in bold:

• I need to be out of debt to save for retirement. Nope. The 50-100% return on your employer match is reason enough to start now.

• Saving $10/week won’t do anything, I need at least $50. Nope. $10/week at the market average return of 10% (nominal) is nearly $100,000 in 30 years — no small sum.

• I need to wait for things to “normalize” before I start a budget. Nope. A budget will help you normalize things.

• I don’t need to worry about estate planning now, I’m young! Nope. Name beneficiaries and create a basic estate plan today.

• I’ll just wait for the market to correct, then I’ll invest my money. Nope. No one knows when the market will “correct,” so if you plan on investing that money for a long time (retirement funds), do it today.

_{Two quotes on patience:}

Financial success is a direct function of patience. Patience is the ultimate compounding factor for life.

_{Three questions on market timing:}

1. What if I am wrong about the direction the market is heading, how much will it cost me?

2. If I get out of the market now, when will I get back in — and how will I know things are “better?”

3. If my time frame for these investments is 5+ years, why do I care what happens in the next few weeks or months?

Which question stuck with you? Questions like these are spotlights for the mind. Reply to this email and let me know which one shined light on a previously dark cave.

_{Four lines of poetry for the point:}

Contact Me:

Content ideas, questions? Reply to this email or reach out to me at [email protected]