Discovering your Path: 

Breaking Free from Financial Conventions

If we document personal finance journeys, most cases wouldn’t be the linear path people imagine. Often it wouldn’t be as simple as following a yellow brick road. If you were to give it an image, it would look driving directions with alternate routes, like a “quest”. Most things aren't as easy as a cooking recipe. 

If you remember Lord of the Rings, our heroes change the directions because there’s a new obstacle in their path. And they do this more than once. This doesn’t change their destination, but it does mean that they need to make some judgment calls. 

It doesn't matter if your goal is having an "emergency fund", saving for a vacation, or saving for retirement. It feels like something always gets in our way, and we need to change our plans. Again.

• If you have a financial plan, don’t feel forced to follow that plan no matter what. It’s okay to move things into an order that works for you, given your current circumstances. You can pay off debts before building a large savings, and you can also invest before you pay off your home.

• Reconsidering your plan isn’t a sign of failure. If you must take money from savings to fix your car, that’s why you have savings in the first place. We can’t plan for everything. We do our best with what we have.

• There are circumstances when you should revisit completed goals. If you accumulate a large amount of debt, you might not be able to save any money until the debt is under control. If you made a final loan payment, you may want to put more money towards retirement. You may need to revisit your budget if your salary changes. Even if your budget is "solid".

   Sticking with the "Lord of the Rings" analogy, we see the heroes travel over a mountain but find it impassible, must turn around if they want to find a new path. So, when they go back the way they came, they still find a way to move towards their goal. If you are saving for retirement and decide buy a new car with a loan, you might not save as much each month because more money goes to your debt. This is still ok because you’re working towards your goal.

   It’s for these reasons I believe the journey of 'personal finance' is akin to a questline. If you’ve ever played a video game, then you remember revisiting the same location time after time. Think of all the side quests that you did, which let you build skills and find tools that helped you grow, or “level up”. Didn’t this make it easier when you decided to follow the main story?

   When we consider our finances, we revisit completed goals. Throughout life, it feels like we have to repeat previous accomplishments.  It might feel like taking two steps forward and one step back. If you have a large emergency expense, you might have to use all, or most, of your savings. Even if things seem to be going well, you may want to reevaluate your position to ensure you're on the right track.

   No two financial journeys are the same. So don't feel like you need to do what everyone else does. Pay debts early or invest while you pay off the house. If you want to boost forward and fly the eagles to Mordor, you can. But it’s also okay if you lose your guide to a fiery demon. Clearly, these things happen.