I recently viewed a PBS special on the The Crash of 1929 and heard the story of Dorothy Livermore. I had never heard this story before and thought it was worth retelling.
In the 1920’s it was very easy to make money in the stock market, lots of money. One of those lucky investors was Jessie Livermore. He played the markets so well it seemed he could never lose. His wife Dorothy was the typical flapper and hated to spend money on things that did not show. Money was meant to be spent so others could see it. She filled their house with expensive furniture and artwork. Gradually the floors began to sag in the old house and she needed to get them fixed. However, her solution was not to hire a crew to come in and shore up the sagging floor, but to spend money for the same crew to saw the legs off their very expensive 18th century furniture to make them level on the sagging floor. Dorothy believed as long as the furniture looked level, the problem was fixed.
I tell this story to illustrate the need for a solid financial plan. Between protection, savings, and retirement you need a solid financial plan to achieve your desired results. Are you building a solid foundation for success? Or are you sawing off legs as you go?