Life unfolds on many levels all at once. Here is a simple guide to getting through our little fiscal storm:
- Economic Runway: There is a saying you should focus on taking care of the downside, and letting the upside take care of itself. I don’t necessarily agree with that in black/white terms but I do think that it’s important that you get your arms around your cash position NOW (cash in bank, income sources, current budget, ideal budget). That tells you how much runway you have to make whatever relative life or lifestyle assessments you think that you will be making in the months ahead.
- Start from a Positive Place: Many (if not most) are experiencing a major life adjustment right now. The economy is tough and there is a measure of uncertainty that is stressing, confusing and depressing. My axiom here is never to make big life decisions when in a bad place. Defer it until you get to higher ground. That can mean carving out a day where you take care of yourself, do something fun or nurturing and THEN carve out a few hours to storyboard where you want to take things. Be honest with yourself about gaps between life goals and current world, and adjustments you need to make.
- Real Change in 1/3/5 Years: I have done eight start-ups, changed industries from real estate to high tech, and talked at length with people who have gone through major place in life transitions (work, marriage, mortality), and one key truism is that you are one year from a major sea change, three years from being really competent in that body of water and five years from being on top of your game. Standing in your current world, it may be hard to see the forest from the trees, and you may struggle between long term and short term goals, but this time-bucket thinking can help what I am about to say in #4 below.
- Straw Man, Scenario Plan: There are probably no more than 3-5 essential questions that you need to affix yourself on if you want to come out of the storm running at full speed. What are they?
I am a big believer that the best way to make fairly complex life changing decisions is to come up with 2-3 fundamental scenarios where you build up a straw man of what the key decisions are in Scenario A, Scenario B, Scenario C, and what your life looks like 1/3/5 years out.
Invariably you will pick apart each scenario and fine tuning but the idea is that by defining 2-3 fully formed options, projecting them out over some time period and then incorporating them into your story with others (e.g., explaining your thoughts and decision process with friends and family) you will discover that one path feels more right for you than the other.
Plus, the more specific it is, the easier it is to fine tune.
The road ahead is workable. Be deliberate, but be fearless.
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