There really is not anything easy about money. Some of it is simple, but nothing is easy.

There are only two things we are going to do with our money — spend it or give it away.

That part is pretty simple.

But almost everything else is hard.

Let’s take the stock market. 

Unfortunately, stocks don’t go up just because you need them to.

There are so many variables and exogenous events that can affect the market that short-term market prognosticators are essentially carnival barkers.

The key question is not whether the markets are going to go up or down (hint: they will), but how will you tolerate those swings.

You know how when someone does something nice, they may say, “It’s the least I can do.” Take that approach with market swings, too.

The case for doing little

One of our clients reliably calls us to sell everything when the market turns south. Other than doing nothing, the least he can do is reduce the amount of money he has directed to stocks as opposed to bonds.

Selling everything is the most he can do. He needs the money to last 40 years, so the next 40 days or even 40 weeks is not as important as the next 40 years.

Getting more conservative increases the likelihood that he will have less money to spend over his lifetime, but he will also avoid market ups and downs.

It won’t necessarily reduce his emotional ups and downs, though, because he may have regret during rising markets that he is not fully participating.

There always has to be a trade-off. Trade-offs are where things get hard.

In this situation, moving a little bit of money to cash or bonds may make him feel better and not jeopardize his long-term aspirations.

If you are uncomfortable with your money choices, you need to evaluate them. This part is not easy.

In her book, “Maybe You Should Talk to a Therapist,” Lori Gottlieb writes, “We can’t have change without loss, which is why so often people say they want change but nonetheless stay exactly the same.”

When you are stuck making the same uncomfortable money decisions, you are most likely avoiding change.

Getting the spending right

Most people don’t know what they are able to spend because they can’t get clear on how much they need for tomorrow or for how long they will need it.

Therefore, if you are spending more than you feel you should, it may be because you are frugal and uncomfortable spending or you may be a spendthrift.

People are generally a combination of each, depending on what they are spending on. In order to change, it helps to deal directly with facts first — what do you have coming in and on what are you spending?

In order to be comfortable with this exercise, you need to do it simply as a fact-finding mission and not judge yourself on the facts.

After getting the data, look at what changes you feel you need to make and describe the loss that you would be experiencing from those changes. Say it out loud.

Then say why you want to make the change.

If you are spending too much, you may benefit by creating more security for yourself or your family.

If you are spending too little, you may benefit through experimenting with treating yourself to something that you have wanted.

The point is to accept the need to change, create an incentive to do so, but don’t go overboard.

Another reason that money work is hard is because we have stories about our relationship to money that are not fully accurate.

Gottlieb writes, “Most people are unreliable narrators. That’s not to say that they purposely mislead. It’s more that every story has multiple threads, and they tend to leave out the strands that don’t jibe with their perspectives.”

Money stories can mislead us

We believe our money stories, but they are not true because we make them too simple by not considering all the things that make the story realistic.

For example, one of our clients was a real estate developer who made a lot of money on places she bought and sold, so the simple story was that she was really good with real estate. Then she got into a bad real estate investment that cost her a tremendous amount of money.

Was she no longer good with real estate? Our stories are often about the results of our actions rather than our processes for making decisions.

This client had benefited from a host of things — savvy real estate investing, a strong market for the types of properties she was developing, a period of low interest rates and many other factors.

With the deal that did poorly, some of the other variables shifted and it cost her. It doesn’t mean that she was brilliant before or an idiot now; it means that the process that she was using did not work in that situation.

It seemed easy until it wasn’t.

The problem with our stories is that although they are generally unrepresentative, they can make us overconfident or insecure, neither of which results in solid decisionmaking.

Soliciting feedback from others who know you but can be open with you may help you see some of the blind spots that those false narratives create.

If your money work is too easy, you are probably missing more than you realize.


Ross Levin is the chief executive & founder of Accredited Investors Wealth Management in Edina.