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Posted on January 5, 2018

Gas Caps and Wrong Turns

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Published by Keith Corrigan

Today I would like to share a quick story about how a series of seemingly unimportant events made me think about the major problems caused by poor money management and how you might avoid making mistakes that could seriously impact your portfolio.

Have you ever had one of those days where the plan you had just didn’t work out? Me too! Let me set the scene: This fall I took a trip with my family in our RV. We were headed from Arizona to Texas and, finally, to Nebraska. Behind our RV we were towing a classic 1955 Thunderbird on a trailer.

When you are traveling in an RV, it is very important to stay focused on the road ahead. Construction areas, blown tires, and stray animals are just a few of the obstacles that will present themselves along the way. Unfortunately, these rigs aren’t really designed to stop quickly or swerve through cones like a race car. No, they are a bit more like ocean liners. They turn slowly, take miles to stop, and have lots of stuff that tends to fly out of cupboards if you attempt any sudden maneuvers.

While we have come to expect many of these common obstacles on our trips, sometimes it’s the unexpected hurdles that catch us most off guard.

  

 

 Pay close attention…even to the mundane

One afternoon of our trip I pulled into a truck stop to get gas. I noticed the pumps were rather close to one another, and my focus immediately changed to ensure I did not hit something as I navigated the islands. Once parked, I jumped out and proceeded to pump fuel for the RV. This mundane task requires little concentration, and, as such, I was thinking of other things as I washed the windshield and completed my transaction. We were back on the road 10 minutes later, and I was feeling good. After all, we only had a couple of hours left to drive for the day. But, as we were driving along I started to notice the smell of diesel fuel in the coach, and suddenly it hit me: In my day-dream-like state I had failed to put the gas cap back on.

All sorts of things began to rush through my head. How much fuel had sloshed out? Was there any damage? Was it getting all over the car I was towing? And on and on. At that point, I decided we only had few miles to go before we stopped for the night, and I hoped there would be a place nearby where I could pick up a gas cap and resolve my problem.

However, when we exited the interstate and started looking for our campground, the sign pointing the way to the park had been removed. We drove right past it. In a rather large RV, turning around can present some challenges, so my wife/co-pilot started looking for a way to get us back to the park. The map indicated we could make the next left and simply drive around the “block,” which was several miles long. We made the first turn and about 200 feet later the road became gravel. Instantly, my mind turned to how that dust would make a nice topping for the diesel fuel that was likely all over our rig and the Thunderbird.

Soon, we came to an intersection where I was supposed to make the first of two left-hand turns that would get us back on track. In the distance I could see there was a bridge over the road that I was not going to fit under. Again, we needed to turn around and head back the way we came. Five minutes and a rather eloquent twelve-point turn later, I got us moving towards our destination. Ultimately we made it to the campground, only to find there was no place to get a gas cap for 20 miles.

Come morning we began looking for an auto parts store and managed to find an O’Reilly’s that was also close to a Blue Beacon truck wash…perfect, or so I thought. As I pulled into the small town, I quickly noticed the streets were narrow, and there was no place to park. So, I found a gas station that looked like a good turn around point. I had no sooner entered its driveway when I heard, and felt, my trailer hitch drag on the pavement. I quickly jumped out to inspect and found that my new hitch had dug itself into the soft black top road. I was going nowhere. I will not bore you with all of the details of its extraction, but suffice it to say it involved a police officer, a tow truck, and an hour of our time. Once back on the road, I did stop and get a gas cap, which,of course, took a few tries to get the correct one.

 

 

 

When life throws you curves, who’s watching your money?

It was there, sitting in line behind six 18-wheelers, that I had time to think about all of this.

You see, this entire series of events had captured my complete attention for the last 24 hours. It had cost me several hundred dollars and provided a few very tense moments. It got me thinking about investing.

I am fortunate. I have a team of investment managers, analysts, and strategists who are watching my money and making sure the proper moves are made at the proper time. They buy and sell as needed to protect my investments and grow my wealth. We meet periodically to discuss the strategies, but ultimately I know they are there watching every day, regardless of what obstacles I face.

It dawned on me that some people are not as fortunate as I am. Those people have decided for one reason or another to manage their own money. When life throws them a curve ball that requires their full attention, their money is left to fend for itself. What happens to their investments when they go on vacation? If they were on a backpacking trip in Washington or fishing on the Madison River, would they know if the markets crashed? Would they know when markets were on the upswing and there were good opportunities to be had?

There are just too many things that can happen in the world that cause the market to react one way or another. You cannot afford to take many days off when managing your money. You can also not afford to make mistakes. You could lose years of your lifetime of wealth in a week, given the wrong circumstances. Of course, there is also the issue of just how knowledgeable you are in investing, but we cover that in our upcoming video blog “The 10,000 Hour Rule.”

 

 

Let an advisor help you manage your money.

There are some interesting studies* about investing that show that the biggest gains and losses occur on just 2% of all trading days. If you happen to miss those days, it could take months or even years to make it up. This is what I was pondering while the team at the Blue Beacon was washing the diesel fuel and dust off our RV.

Over the years we have heard so many stories of people losing everything or just struggling to get by because markets did not go the way they thought they would. I sincerely hope that if you find yourself contemplating managing money by yourself you will at least meet with a trusted advisor. You can quickly lose a lifetime of earnings and be faced with tougher decisions than which campground to visit. All it takes is for you to lose focus one time or make one gas-cap sized wrong move.

 

 

*Index Fund Advisors – “Missing the Best and Worst Days” https://www.ifa.com/12steps/step4/missing_the_best_and_worst_days

 

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