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Organization, Efficiency & Discipline

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Simplification is usually beneficial to any pursuit. If you can break down the basic principles of whatever “big thing” it is that you’re hoping to accomplish into simple concepts, you’ll do well in your pursuit.

This is true for whatever you’re hoping to accomplish – climbing Mount Everest (train, prepare, keep going up); write a book (gather information, organize, keep writing); or get a college degree (show up, pay attention, study). In preparing for retirement (or saving for any goal), I’ve always broken the concepts down to organization, efficiency, and discipline.


In order to get things started, it’s important to know where you are in your financial life. When you’re getting driving directions from Google Maps, the first thing they ask you is where you’re starting from. The same goes for “mapping” your financial path. Gather together your information and organize it so that you know what assets and what liabilities you have. This can be as simple as listing everything out on a piece of paper, or a computer spreadsheet, or using some of the tools available on the internet, such as

Also gather your information about your monthly and annual expense requirements – preferably with an eye toward understanding what is a “must” expense and what is a “nice” expense. If you’re having trouble balancing your budget (your income is less than your expenses) you’ll need to look at the “nice” expenses and determine what you can do without.

The last piece of Organizing is to set forth a goal – or several goals, depending on your situation. Maybe it’s a goal to retire in five years… or to send your kids to college in 8 years. Whatever is the goal, you need to quantify it (put it in terms of dollars and time), and so that you can map out the way to get there from where you are now.

Having everything organized will tell where you are financially, and knowing what your expenses are compared to your income will help you to understand what you can do to make changes in your financial life in order to reach those goals.


Now that you know where you are and where you’re going, it’s time to figure out how to get there. As you know, there are many types of investment accounts, investment products, and the like, that you could use to increase your bottom line. My preference is to use the most Efficient methods, in terms of placement of funds, taxes, expenses, and risks, in order to take you toward those goals.

When saving for a goal, especially a goal with a long-term time horizon such as retirement, it makes good sense to be tax-efficient as possible with your choices of investing accounts. IRAs and 401ks provide near-term tax benefits but might prove to be more tax-costly in the long run; Roth-type accounts provide longer-term tax benefits due to the tax-free qualified withdrawals from those accounts.

Efficiency of investment occurs when you utilize vehicles such as mutual funds to provide diversification across multiple investments within one transaction. It is far more efficient to purchase no-load, zero-expense (or near zero) mutual funds and ETFs than it is to track and purchase a large number of individual stocks (and bonds).

Efficiency in expenses can be addressed by utilizing no-load index mutual funds and/or Exchange-Traded Fund (ETF) indexes. These two types of investment products generally provide the most cost-efficient methods of investing. In addition to the cost-efficiency, ETFs are also very tax-efficient, due to the structure of the funds.

Not only are indexes very cost-efficient and tax-efficient, but indexes are also risk-efficient as well. If you invest in indexes you are getting (generally) the market’s movement in returns – something that less than 40% of managed funds can do regularly.


Now that you’ve figured out the methods to use in getting to your goals, you have generated a plan to accomplish those goals. This is where discipline comes into the picture. In order to achieve these goals, you have to create your plan and stick to it, through thick and thin.

When the market is having difficulties and your accounts are experiencing a downturn, you need to maintain the intestinal fortitude to continue with your investing activities. This is where a good financial advisor or just an accountability partner can help you out a great deal.

It’s maintaining the long-term view in the face of short-term “noise” like a market downturn that helps you to meet those goals. Chickening out and selling at the wrong time can derail things.

Discipline also extends to creating your budget and sticking to it as well. By reviewing your expenses and determining where you can reduce, you’ll be able to free up more money each month to eliminated debt and increase your savings balances. But this only works if you really stick to the budget. Fudging it will gradually erode the result you’ve planned.

Bottom line

By putting these basic tenets of Organization, Efficiency & Discipline to work for you, you will soon begin to see progress toward your goals. Keeping things as simple as possible helps to ensure that you’ll stay with your plan. As with everything else, let me know if you have questions!

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