Recently I listened to a podcast where Vicky Robin, the author of Your Money or Your Life (I just ordered the book and I’m looking forward to reading it) was interviewed and she talked about this concept of looking at your current financial position (i.e. your personal balance sheet) in a “No Shame, No Blame” way as a way to drive change. I found this quite interesting and personally think there is a great lesson here for everyone. Your ability to realistically confront your current financial position is perhaps the only way you can be motivated to make changes that will improve your future financial position.
So, if you did the challenge I posed earlier, where I challenged you to look at your tax returns over the last decade and add all the income you’ve earned to determine how much of this income you’ve kept, then that is a great start. Let’s say for example, you determined from this exercise that you’ve made $2 million and now you have a net worth that shows you’re $50,000 underwater (i.e. if you sell all your assets and pay all your debt, you will still be owing $50,000), what should you do? Vicky suggests that you confront the results of your financial behavior in the past, stomach it, and accept it in a “No Shame, No Blame” way. By doing this, you will be motivated to learn from your mistakes and develop new money habits so that when you earn $2 million or $4 million over the next decade, you will keep all of it!
Confrontation is tough, particularly, when it comes to our personal finances. I know because I have personally been challenged several times in the past with confronting my financial position. Confrontation is particularly more challenging for men as men generally tend to protect their pride more than women do. So, you have to learn to move past your mistakes, to forgive yourself for the bad behaviour in the past and move forward in a “No Shame, No Blame” way to design the life you want to live. The ability to confront is one of those character dimensions we all must develop to be successful in life. In his book, Integrity, Dr. Henry Cloud quoted one of his favorite sayings…
“Reality is always your friend”
If you don’t embrace the reality of your financial position, you will be living a false life and you will have little or no chance to be successful. So, we must learn to confront the brutal facts as missing reality can have disastrous consequences in the areas we care about the most in our lives. Dr. Cloud goes on to say…
“So, for us to get real results in the real world, we must be in touch with what is, not what we wish things were or think things should be or are led by others to believe they are. The only thing that is going to be real in the end is what is. That is where profits are going to be made, and that is where love is going to be found.”
I think this is a profound statement. By the way, if you’ve not read integrity, I strongly recommend it.
So, if you’ve not taken up the challenge of looking at your financial position, go do it now. As you review the results of your past financial behavior, acknowledge and accept your past mistakes, assign no blame, have no shame and embrace the reality of the results before you with love. Remember, you have accomplished great things in the past, be grateful for the things you’ve achieved and for the opportunities ahead of you. I am cheering for you. So, go get it!