2016 Olympic Games
Financial Lessons Learned from the Olympics
We’ve all heard the horror stories about the costly effort host cities spend on the Olympics, and then how billions of dollars in new venues turn into abandoned facilities. You’ve probably been in a similar situation, deciding to spend a significant amount of money on something you hope becomes a long-term investment, only to find that it didn’t go according to plan. What financial lessons can we learn from the Olympic Games as we watch to see if Alex Morgan can lead the women’s soccer team to victory or if Simone Biles will become the fourth straight U.S. female gymnast to win the Olympic all-around gold medal?
1. Be realistic. Not every athlete becomes an Olympian overnight. They go through years of vigorous training, competitions and physical evaluations. It’s the same thing with your finances. Before you can reach your goal, the first step is to track your expenses for at least a month. Reviewing your transactions allows you to see how much money is going where, and then you can build your budget. A guideline is to spend about 50% of your paycheck on fixed monthly bills like rent and utilities, 30% on more flexible spending like food and entertainment and 20% on your financial goals of saving or paying down debt.
2. Visualize and plan. One of the more common sports psychology tools for greater success is visualization. Olympic athletes visualize themselves on top of the podium and imagine the feeling and weight of the gold medal hanging from their neck. To reach your goal, think about what you’re passionate about and what you are saving for. Whatever it is, make sure you have a goal that inspires you and keep that dream at the top of your mind.
3. It’s not how you start, it’s how you finish. Track and field stars don’t have to be the first off the starting block, but they aim to be the first to cross the finish line. Don’t start off to fast and burn out. For example, going from saving 5% of your income to 10% overnight may not be realistic. However, what if when you get your annual raise, you increase your saving 1%? Or, make room for savings in your personal budget with small adjustments like bringing your own coffee or lunch to work once a week, and work up from there.
4. Gold medals aren’t a solo effort. Michael Phelps may be standing at the top of the podium by himself in Rio, but that doesn’t mean he didn’t have help to get there. Never be afraid to ask for help along the way of your financial journey from your credit union or financial institution. When you reach your financial goals, don’t forget to thank your support “team”: benefits advisor, career coach, tax accountant, financial planner, insurance agent, investment adviser and/or estate planning attorney.
While all of us here at The Partnership are rooting for Team USA, we’re also rooting for you to succeed financially. We’re here to help in any way we can.