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Foolishly, I went for a run Up North just as the sun was setting. Several minutes into it, I realized that my dark outfit and a quarter moon were not compatible with trotting along backwoods roads. I started to play in my mind what I would do should I be hit by a car or attacked by a bear (or a skunk). Nothing actually happened, but my survival instincts were on high alert.
The experience prompted me to recall a conversation with a client who was commenting on how fragile he thinks people feel right now. While the economy and the markets have somewhat recovered, there are still a lot of people looking for work or with improperly invested portfolios that have caused them to adjust their picture of the future.
Thumbing through my worn copy of "Tom Brown's Field Guide to Wilderness Survival,'' and thinking of that client conversation made me realize that Brown's words of wisdom apply to financial planning.
"The most important survival tool is the mind. Over time, how you feel about yourself will determine how well you adapt to your new environment and its changing conditions,'' Brown wrote.
Keep your head
We have control over some things, but less than we imagine. We can't control how our boss treats us, but we can control how we respond to the treatment. We can't control short-term market volatility, but we can determine how much we save and how the money is invested.
I was talking to a friend who recently lost his business. While I knew this person to be goal-oriented, I had no sense of his incredible resilience. He has taken a job and has laid out a plan as to how he can begin to recover the money that he lost. Most important, while he spent some time being angry and frustrated and even wallowed in self-pity, he moved on.
Things are always changing, at times for the better and at times for the worse. When things go wrong, it's fine to briefly despair, but advancing to problem-solving is the quickest way to move on.
In survival situations, Brown asks, "What is it that makes a person decide to live rather than give up and die? ... Often it is the ability to accept the present situation and to deal with each moment as it comes."
When the markets were at their most volatile, the people who had the best results were those who did not panic. They made incremental portfolio changes rather than huge ones. If their plan was consistent with their objectives, they did not overreact to the news of the day.
The Standard & Poor's 500 is now up about 70 percent since those dark days in March 2009. Yet mutual fund data show that money continues to leave stocks and move into "safer" places like bonds. I am not sure that a 1.8 percent yield on a seven-year Treasury is particularly safe after paying taxes and accounting for inflation. Had scared investors heeded Brown's most important rule for anyone who is suddenly faced with a survival situation -- "don't panic'' -- they would have been financially better situated.
While Brown is describing how to survive in the wilderness, he makes a fantastic financial planning point: "You'll go a long way toward increasing your mental comfort by realizing that you cannot immediately have everything you want, but that you can have everything you need."
Our survival instincts are shaped by our experiences and their interpretations. When was the last time that you actually sat down and counted your blessings? I was talking with someone who keeps a daily appreciation log of what is going right in his life. Of course, there are things that we want, but the more time that we spend appreciating what we already have, the less we will need to keep looking ahead.
Yet sometimes we are faced with really terrible situations. One of our clients is experiencing serious health problems. I am incredibly impressed with how, after a significant amount of grief, he and his wife are confronting some of the tough choices that they need to make.
Brown says, "If you are in a particularly bad situation and can do nothing about it, your only alternative is to endure it. ... Sometimes you may be so uncomfortable that you will have to back off every few minutes and ask, 'Am I all right?' If you are all right in the moment, that is all you need."
Most of us turn our quest for comforts into one of survival and in the process forget that we probably have it pretty darn good.
Spend your life wisely.
Ross Levin is the founding principal and president of Accredited Investors Inc., Edina. He is a certified financial planner and author of "The Wealth Management Index" as well as a collection of essays "Spend Your Life Wisely." His Gains & Losses column appears on the fourth and fifth Sundays of the month. His e-mail is email@example.com.