Pete the Planner: Here’s the recipe for winning the financial game

Last week on my radio show, I entertained an email in which the central question revolved around what a person is supposed to do once they’ve financially “won the game.” While I certainly understand people think this way, the question sent me reeling, especially since the inquisitor was simply a 40-year-old who was making $100,000 a year more than he needed to survive.

I’m not quite sure why this question required nearly three segments to address, but there was something about it that disturbed me. Ultimately, I decided there’s two ways a person could conceivably “win the game,” and one of those ways is so much easier than the other.

Typically, when people talk about having won a game, they concede the point that the game is over and there’s no way the outcome could change. This is where I kept getting stuck. I’ve seen so many people have 50-point leads going into the third or fourth quarter but somehow end up clutching a defeat from the jaws of victory.

I believe the most common way people visualize winning the game is to “have a lot of money.” Whether you were inspired by Richie Rich comics, Annie’s Daddy Warbucks, or the wealthiest waterfowl of all time, Scrooge McDuck, the idea of unvanquishable wealth feels like a game worth winning. I’ve seen only a small handful of people amass mistake-proof wealth, yet somehow I’m aware of millions of people who think they’ve amassed game-winning wealth. Life happens. And very wealthy people with 40-point leads are subject to life happening, too.

There are countless ways a Scrooge McDuck-size nest egg can find itself leaking yolk, and sadly, I’ve witnessed most of them. Our society got in this weird place a decade or two ago in which we’d vilify professional athletes for fumbling away financial victory, yet due to the private nature of most financial pain, we never considered the fall of lawyers, doctors, business owners or anyone else who found themselves with a massive lead.

For your consideration—there’s a better way.

The better way is more inclusive of more people, and a smarter strategy altogether. In this way of thinking, “winning the game” revolves around “not needing a lot of money.” No, I’m not suggesting you employ pauperdom. And, yes, you must be able to identify and appreciate nuance.

It is possible to “win the game” by having the proper mindset. This is why so many people who never made a six-figure income throughout their careers are able to have a beautiful, mistake-proof retirement. And with all due respect to the young man who emailed my radio show, he had yet to discover this sustainable and repeatable strategy.

Anecdotally, the Greatest Generation inherently understood how to win the game. Most often, the result was a peaceful financial outcome, and sometimes wealth was the actual byproduct. That’s the strangest aspect of this entire idea—wealth is the byproduct, not the aim. I’ll say again for the people in the back—wealth is the byproduct, not the aim.

While my assigned word count doesn’t allow me to share the exact recipe today, I can share some omnipresent ingredients for success. The right combination of these elements has been known to manufacture significant victories. Transparently, it’s a healthy mix of correlation and causation.

Here’s the list: a mortgage-free home you plan to live in for decades, a pension, charitable giving that precedes amassed wealth, an OK car, a financial planner, modest vacations, no Parent PLUS loans, good health insurance, job stability, a household budget, long-term-care insurance and a healthy dose of luck.

You’re not alone if you’ve been chasing the first description of winning. If this is you, focus on the word sustainability. In what ways are your wealth and lifestyle sustainable, and in what ways can it all go away? How much would shifting your focus to not needing a lot of money impact your ability to have a lot of money?

Ask your three best friends—does your strategy for a financial victory involve having a lot of money or not needing a lot of money? Listen and run their answers through the filter of this column. Which answers seem sustainable, and which answers feel like you might be watching your favorite team on the cusp of giving up a 40-point lead in the third quarter?•

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Dunn is CEO of Your Money Line powered by Pete the Planner, an employee-benefit organization focused on solving employees’ financial challenges. Email your financial questions to askpete@petetheplanner.com.