The Beauty of (Some) Bad Financial Decisions
I have a confession: I might soon make a bad financial decision. Mathematically, it's not the right thing to do. It won't increase my net worth. It won't improve my monthly cashflow. It won't lead to the betterment of my family's financials over the long term. It's a flat-out bad financial decision. If that's true, and I know it's true, why on earth would I entertain such a decision? Because not everything is about money. Not everything in life is about optimizing for money's sake. We aren't little robots whose job is to crunch numbers and make the best mathematical decision at every point along the way.
Here's an example. I regularly argue that owning a house is often a bad financial decision. Hot take, I know. I've dug into the numbers to make my argument in the past, and I'm sure I'll do it again soon. But I'm firmly in the camp that owning a house is frequently a bad mathematical decision. However, I always follow that statement up with, "......but it may be the best life decision." I'm pro-home ownership, but not for mathematical reasons. For many people, home ownership represents something far deeper. Whenever a coaching client says they want to buy a house, I show them the math to prove why it may not be a good mathematical decision......then will often encourage them to buy the house anyway. It's not always about math and money. Sometimes it's about something deeper.....far deeper.
Where it goes awry for people is when they make a decision because they think it's a good financial decision, only to discover it's anything but. Those are the situations that burn people. On the flip side, when people know a particular decision is a poor financial decision, but know it's still the right decision to make, it can be a real blessing. This self-awareness makes all the difference in the world.
So yeah, I might make a bad financial decision. It's too early to tell, but it's on the table. If I do, it's because the non-financial aspects of the decision outweigh the financial ones. In the world of meaning over money, this is the meaning part. Always meaning over money.