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As a volunteer budget adviser I saw the result of many clients burying their heads in the sand. Years and years of pretending there is no problem or looking the other direction.

High credit loans, bad debts, and so on. Some would even come to the office with a pile of unopened envelopes containing bills and invoices. They couldn’t bring themselves to seeing what they really knew already.

If you don’t see something, it’s not really there right?

not making a DEcision is still a decision

We also see this problem in general, where kiwis ignore their financial health. We’ve all seen those stats that say how little we are saving, how much we are spending and how little we have for retirement.

But just because you may not think about money or your retirement, it doesn’t mean the problem isn’t bubbling away under the surface. The consequences of ignoring saving for your retirement become all too real the closer you are to retirement. The drum beats get louder.

That is why making no decision is still a decision.

A decision not to focus on your bettering your financial situation is a decision to not worry about your future self.

I get that making decisions can be hard. We have so many demands for our time, that stuff like retirement that may not affect us in the now get pushed to the back of the line to help save some mental bandwidth.

Not only that but by not making a decision, at least you are not making the wrong decision right?

But the consequences of not making any decision can be much worse than just getting started and making the wrong decision. After all, every wrong decision is a step closer to the right decision.

Let’s say Sally is 30 years old and has $500 a month to invest in the next 20 years. She has a look at all the different options for investments and gets overwhelmed. She decides to park that idea for now and just continue spending her money instead. She intends to revisit investing later but never does. Each time she has a look at investing again, she sees there are even more investment options now. The world evolves. It moves on. Things won’t get easier the longer she leaves it. At age 50, she still hasn’t saved for retirement.

Gertrude on the other hand (also 30 with $500 a month) is also overwhelmed with all the investments. But she realises the importance of securing her retirement and just chooses some investments. She realises there may be better options for her, but she thinks something is better than nothing. Lets assume just 3% returns over the first 5 years, 4% returns over the next 5 years as she learns from her mistakes, and 5% returns over the next 10 years as she learns some more again. Age 50 she would have around $200,000. Maybe more if she engages working with an independent financial adviser :)

Maybe not as good as making the right decisions from the get go or getting financial advice, but still obviously much better than doing nothing like Sally.

The same can apply to any aspect of life. For example, I was in one unhealthy job for 5 years. I kind of knew how bad it was for me but I carried on with the status quo as it just seemed easier. With each passing year though, the drumbeats of what was bad about the job got louder and louder. It finally took me taking 3 weeks off work in a remote location to take the time I needed to think things over and proactively make a decision. I couldn’t unwind even though I was in a magical location and knew then it was now or never. It was a scary decision to leave the job at the time as the job market wasn’t strong and it was the only job I had known, but it remains one of the better decisions I have made.

Likewise, in my early 40’s, I am realising the impact of some of the decisions I didn’t make in my 20’s and 30’s that would have benefitted my health today.

It pays to be a critical thinker of your own life. You only get one.

So be decisive and remember that no decision is a decision towards the person you want to be.

If you don’t like the direction you are heading, then tackle it head on and stop ignoring it. Make mistakes. Be curious. Otherwise, life moves on and chances are, you will drift further and further from where you want to be the longer you leave it.

The information contained on this site is the opinion of the individual author(s) based on their personal opinions, observation, research, and years of experience. The information offered by this website is general education only and is not meant to be taken as individualised financial advice, legal advice, tax advice, or any other kind of advice. You can read more of my disclaimer here