The First Step in Solving Money Problems
Money problems come in all shapes and sizes. But in all cases, the first step involves defining if it is a puzzle or a mystery.
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We discussed the two types of money problems on The BIGG Success Show today. Here’s a summary of that discussion.
This show was inspired by a post on Psychology Today by Utpal Dholakia. He borrows a concept from the national security expert who – literally – wrote the book on puzzles and mysteries* for the intelligence community.
The first step in solving a money problem is determining the kind of problem you’re dealing with.
2 kinds of money problems
A money problem may be a puzzle or a mystery.
A puzzle is a money problem with a fixed solution. You can quantify it. It can be solved in one or more tangible steps. Like a jigsaw puzzle – as more information is secured, clarity increases.
A mystery is a money problem with a moving solution. The solution is fuzzy. In fact, you don’t actually solve a mystery. You frame it. Like a game – more information increases the difficulty of solving the problem.
An example of each type of money problem
Example 1
“I need additional liquidity in case the unforeseen happens.”
Your solution to this may be: “Save $1,000.”
To accomplish it, you may save an extra $100 from your next 10 paychecks.
It’s a puzzle.
Example 2
“I want to retire comfortably.”
How do you define “comfortably”? How much money does that require?
Your answer will be driven by factors like:
– At what age do you plan to retire?
– How long do you think you will live?
– Will you be in good health until you pass on?
There are a lot of contingencies here.
It’s a mystery.
And here’s an important point – quoted directly from the post:
“Our most consequential money problems are mysteries.”
Does this only apply to money problems?
No. It applies to all areas of your life. For example, think about a career.
“I need to get a degree” is a puzzle.
But where will you be in your career in 10 years? That’s a mystery for most.
How do you solve a mystery?
We love this conversation about puzzles and mysteries because it reinforces what we often say:
In a rapidly changing, uncertain word, you must learn to think like an entrepreneur. Even if you never plan to own your own business, you own your life.
That’s why we talk about moving beyond personal finance to personal entrepreneurship. Money is just one part of a thriving enterprise. And you run a very special enterprise – your life.
The world we face is complex. Our planning needs to respect this. We need to know when to use traditional models and when to use more entrepreneurial models. Mysteries require the latter.
You have to:
– set your direction
– try something
– track the results
– tweak it (if necessary)
It leads to BIGG success!
BIGG Takeaway
When you don’t know what to do, try something.
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Free Kit!
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Here’s to your BIGG success!
George “The Professor” & Mary-Lynn
Co-Founders, BIGG Success
Direct link to The Bigg Success Show audio file | podcast:
http://traffic.libsyn.com/biggsuccess/00948-082818.mp3
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