Are we making this too hard?
I didn’t write last week. For those of you in Cayman, it was a bit of an ‘all-over-the-place’ week. A holiday on Monday threw us off at the beginning and then a 7.7 earthquake on Wednesday had us all in a spin.
I spent much of the week before last preparing for, attending and speaking at the Cayman STEP Conference. STEP is the Society of Trust and Estate Practitioners. Although I am not such a Practitioner, it weaves into the conversations I have with clients.
There were a couple of major take-aways for me from two days of listening and learning.
One of the major thought-leaders in the financial planning profession, Richard (Dick) Wagner, once said, “Everybody gets weird around money.” The stories we heard of multi-millionaire (or billionaire) siblings fighting over money and then over a dog (that no one actually wants), of families spending years in litigation because ‘something was promised to me’, of adults who have lost all sense of perspective, made me realise (once again) that it doesn’t matter how much or little you have, you are going to be weird about it. It’s a fact.
The psychology of wealth is fascinating. Understanding how our evolution shapes our relationship with money is, I think, wildly important in ensuring that at some critical point we are able to step off the treadmill and say, this is enough. I have written about this before here and here and here.
“Wealth is like seawater. The more you drink, the thirstier you become.”
My other thinking point from the conference is that most panels spoke about the complexity of dealing with ultra-high-net-worth individuals. The complexity of their structures, the complexity of their investments, the complexity of their families, the complexity of their lives.
And I wondered, how did it get to this point? Why is it so complicated? And who does it serve?
It seems to me we are making this much harder than it needs to be.
There are of course some additional things to think about for someone with $100 million as opposed to someone with $100,000. But I believe that everyone wants a simple life. Unfortunately we have an industry that relies upon the fact that complexity sells. “Oh Dear Client, you don’t like green? Don’t worry I have this in blue and pink. And you want it in red too? Have them all!” This is Wall Street in a nutshell – an industry set on selling one of everything they have to anyone that will buy it. Wall Street is upstream, and everything downstream flows from it.
Great wealth doesn’t have to be complex. Einstein supposedly once said “everything should be made as simple as possible, but not simpler.” And it’s hard to keep things simple when you have tens or hundreds of millions. But it can be done. It requires focus, purpose and a deep understanding of what and who the money is for.
For us mortals who are not yet worth tens or hundreds of millions, the key in the wealth building process is to continuously buy, through all the ups and downs, the global stock market, as cheaply and efficiently as possible. Say no to everything else. Simple, right?
If only it was that easy.
Georgie
georgie@libertywealth.ky