How To Turn Losing into Winning With Your Money

Average Joe blogs about topics he finds entertaining at the cleverly named “Average Joe’s Money Blog.” He’s also the co-host of the relaxed money podcast Two Guys & Your Money.
I remember as a kid I was fascinated by these huge domino chains:

I’ve come to realize that part of my fascination might be what the simple act of dominos falling means to me. I love watching one positive result lead to another. Even when all doesn’t go exactly according to plan (they had to roll the marble twice AND there was a break in the chain at one point).

One positive result has a tendency to create another one. In fact, I tell my son all the time when he becomes frustrated that 90% of the time, it’s his actions that ultimately created the frustration.

He doesn’t want to clean his room. If he’d take ten minutes in the morning to make his bed and pick up his clothes (or even hang up clothes the moment he takes them off), he wouldn’t have to do it on my schedule.
The computer isn’t working right, and it’s eleven o’clock the night before the paper is due. Why does he wait until 11 o’clock to finish the project? If he’d finished earlier, he wouldn’t have to worry about last minute tech malfunctions.

Likewise, we all have this with our financial situations, don’t we?

– Donald Trump began investing in houses with his father at a young age. He learned the ground rules for real estate early on, which led to bigger projects and ultimately, a real estate empire.

– Warren Buffet invested in stocks as a kid. He paid attention to the numbers behind public companies. Today he can quickly evaluate a company’s business prospects and make investment decisions which beat those of nearly any other investor.

– Steve Jobs took a calligraphy class. Many people say this attention to lines and shapes helped fuel his love of style and character, which made Apple the sexiest tech company of all.

On a smaller level, I saw this with clients:

– A client began max funding his 401k starting at 22 years old. He could barely do anything else, but he socked money away. At age 28, he already had $160,000 saved toward retirement. Using the rule of 72, if that money grows at 8%, it’ll be roughly $2.56 million dollars at retirement. …better yet, that’s if he doesn’t save another dime.

Unfortunately, that’s not the only domino chain that can happen. Momentum can be your best friend or a total bitch. How about this:

How’d your stomach feeling watching that train-wreck-in-slow-motion? While this may not be familiar, the feel of negative momentum might be:

– Credit card payments become so high that just paying the interest is a chore. No matter how much you pay, it seems like you aren’t touching the principle…and when you do, something comes up that forces you to spend more money on the card.

– Student loans force you to take a second job. The second job is so exhausting you to fall asleep at your real job, and the boss decides you aren’t working as hard as others. At best you’re denied promotions and raises. At worst, you’re fired.

– You don’t have money for car repairs. Your car breaks down on the way to an important meeting. You lose out on income you would have had, if things had gone right.

Do any of these sound familiar? Does it sometimes seem like you’re rolling a boulder uphill?

Whether life is going well or poorly, you have to remember two concepts:

1) Momentum itself is neither good nor bad, but it exists. It’s just Newton’s Law: a body in motion tends to stay in motion. It’s going to be hard to create the friction to stop momentum. You’re going to have to exert a ton of effort to turn negative events around, but once you do, this momentum will work in your favor. Remember this on the days that you’re ready to give up: it’s going to be difficult to stop negative momentum. But once you do, life is going to be much, much easier….


2) Once you have positive momentum, you can then work equally as hard to continue it. Now, every good result is amplified. As your momentum increases, it creates a widening array of opportunities you never would have imagined. One good domino fuels many, many more. Have you ever wondered how Donald Trump can execute so many transactions a day? Why Warren Buffet can have a hand in so many companies? Their secret is simple, and it’s the same one in front of you now:

They started building momentum by toppling one domino.

***Editor’s comments: Thanks Joe-this is definitely helping me with my blogger burnout! And yes, I can see how I got into debt by a domino effect. Better yet, I’m getting out of it by doing the same thing–one thing at a time but in the right direction this time 🙂 Oh, and I *never* waited until the last minute to do a report and have the computer crash…..***


16 Comments on “How To Turn Losing into Winning With Your Money”

  1. Nice post Joe! You’re right, momentum is a great thing when you have it working for you…not so much if it is working against you. We too believe that most situations are created by one’s own doing. If one doesn’t take responsibility for their situation, they are unable to fix the underlying problem.

  2. Cat says:

    This is a great post! I think the main thing is getting that momentum started (for good things) and slowed down (for bad things). Hopefully this will motivate me too!

  3. This is definitely a great post! I love the simplicity of it and how this concept can be applied to so many areas in life.

  4. All I can say is you are so right, and have witnessed this both good and bad in my own life! I think the positive one for me is working out. I always tell people that you just have to start moving and the rest will take care of itself.

  5. Jason @ WSL says:

    Success and progress definitely feeds further success and progress. Motivation and momentum are tough to stop when you have it going in the right direction!

  6. Great post. Positive momentum starts with the person who sets goals and doesn’t want to give up no matter what. Once you start to see the results even the smallest of gains you don’t look back, you keep pushing forward even through the negative to reach your goals. Taking the first step is always the hardest. Mr.CBB

  7. John S @ Frugal Rules says:

    Great post. I agree with Mr. CBB that the hardest part is always the first step. Momentum is a beautiful thing, if going in the right direction.

  8. While I’m not maxing out my retirement I am putting a very decent sized chunk away… at least in my opinion anyway… I hope I have a similar result one day as I increase the amount each year.

  9. Renée says:

    Thanks for those great vids!

  10. Great post. Getting started is not easy, but I’d venture to say the hardest part is staying the course. After the first couple of years or so, when you’re on a nice roll, something like the iPhone 5 launch comes up. If you’re a fanboy, you look at that and say, “Aw, c’mon, a few hundred bucks isn’t going to make any difference, is it?”

    That is when the momentum changes direction. It starts so small and it is so easy. That’s why the big kudos go to the ones who can stay the course for a few decades. My hat’s off to those folks!

  11. AverageJoe says:

    Thanks for the comments, everyone, and thanks to B for letting me fill in for a day! Any time I get to show an awkward video of a complete train wreck is a big win for me…. After I read your comments I remembered an old Zig Ziglar phrase about how working those old hand pump wells worked. My grandfather had one on his farm that he used to feed animals. You had to pump and pump and pump and no water would come out. You’d pump until your arms ached. Once the water started flowing, though, you could use one finger on the pump and gently move it down and the water would still gush out. That’s momentum.

    • bogofdebt says:

      Thank you again for writing a post! I actually remember those hand pumps-we had them on a property when I was younger once. The start up sucked but like you said, after a while, it was easy!

  12. […] Joe wrote an excellent guest post about momentum and how it defines our lives at Bog of […]

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