Sadness - Woman sitting on a bench alone

Three Ways To Minimize Dying With Regret

in Financial Planning by

“Sam, you will regret more of the things you don’t do than the things you do,” said my friend and office mailman, Jack. I could see the sadness in his eyes as he quietly sat still thinking about all the things he should have done.

“I should have taken more risks. I should have tried new things. I should have planned my finances better. I’m 56 years old and I’ve got hardly any savings. This wasn’t the life I envisioned,” he continued.

Every afternoon for 10 years Jack and I would chat for five minutes about our respective futures. He was a frail fella who sometimes came into work with a bandaid on his bald head to cover the sunspots that gradually formed over time.

Then one day he stopped showing up. Jack, the kind man who made $33,000 a year and beloved by all was laid off. The financial crisis showed no mercy, not even to a loyal employee who cost the least.

THREE WAYS TO AVOID REGRET

2008-2009 is a time period that many of us would rather soon forget. But ironically, the financial crisis helped embolden me and several of my friends to take more risks. Going through the worst downturn ever and surviving made us realize nothing else could be as bad.

Ever since riding in the back of my parent’s friend’s Mercedes as a 7th grader, I’ve always wanted to be an entrepreneur. But I neither had the guts, nor the financial wherewithal to take such risk. I turned down an entrepreneurial opportunity to work in Shenzhen, China in 1999 for the “safety” of working in finance in New York City. But every year I worked, I wondered what my life would have been like if I took the left fork in the road instead.

Regret is one of the worst feelings ever. I should have just kissed her, was one regret that plagued me all throughout high school. I didn’t want to look back as a 70 year old and regret having never tried entrepreneurship, so I took the leap of faith in the spring of 2012 to do my own thing. It’s petrifying to go from making a decent income to making hardly anything for the first year. But I don’t regret the move one bit.

Here are three ways to avoid regret:

1) Provide maximum effort. You can fail due to brutal competition, unforeseen exogenous variables, or simply a bad idea. But never fail due to a lack of effort. Hard work requires no skill, therefore you are in full control of your work ethic provided you are an able bodied person. If you’ve truly tried your best, then regret will be minimized because you know that there was nothing more you could do. The regret won’t completely go away, but it will be small enough that it won’t send you into some dark hole.

2) Ask yourself what’s the worst that could happen. Once you understand the realistic worst case scenario, then everything else isn’t so bad. Almost everyone I knew lost 30%-60% of their net worth during the financial crisis. Even if you ended up selling everything at the bottom, you’re probably still standing and in better shape than you were before. Having an idea of the worst case scenario creates a backstop that helps eradicate fear. But there’s a likelihood that many other scenarios will happen instead. Come up with at least two different subpar scenarios and steps you plan to take to improve the situations. The more scenarios you can plan out, the more prepared you will be. Part of regret comes from getting blind-sided by circumstances that could be avoided with better planning.

3) Imagine yourself with only one year left to live. There’s a great line in the movie Inception where Saito asks, “Don’t you want to take a leap of faith? Or become an old man, filled with regret, waiting to die alone?” Life speed accelerates. Eventually we’ll realize the end is near and pontificate on all the things that could have been. Try projecting yourself into the future and understand what are the things you will most regret. Surely you will regret more of the things you didn’t try than the adventures you took.

THE REGRET MINIMIZATION FRAMEWORK

Have a watch at how Jeff Bezos, founder of Amazon came to the conclusion of quitting his well-paying banker job mid-way through the year to start Amazon.

I firmly believe the older we get the more we will regret our inactions. We’ll start telling ourselves that we are too old to do so-and-so anymore. Even if we fail, at least we know we tried. There are countless naysayers who will criticize everything you do. Thank them for giving you the motivation to carry on. The reason why they make fun of you is because they don’t have the courage themselves to try.

Unless you are extremely lucky, nothing great is going to just happen to you. Take action, provide maximum effort, do your best to plan for the unknown, and hope for better days ahead. If she slaps you for trying to kiss her after the third date, if the Venture Capitalist rejects your one minute elevator pitch, or if the new job opportunity doesn’t work out, at least you know you tried. The sting of rejection only lasts a short while. Regret lasts for a lifetime.

Plan your finances with Personal Capital

Readers, what are your regrets? How do you minimize your regress and maximize happiness?

Photo source: Public Domain

Regards,

Sam

 

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Financial Samurai

Sam is the former Managing Editor of the Daily Capital blog. He worked in finance from 1999-2012 before deciding to focus full-time on his online endeavors - FinancialSamurai.com and the Yakezie Network. Sam is an avid tennis fan who loves to travel. He received his BA from William & Mary and his MBA from UC Berkeley.

5 comments

  1. Jen

    I would hate to get old and be filled with regret. Life is short. It’s scary taking risks, but I try to push myself to get out of my comfort zone.

    I invested in the market, and now own two properties. It was intimidating using a lot of cash to do all these things, but I had to follow my gut and just go for it. I am motivated more than ever now and don’t have any regrets about putting my money to work anymore!

    Reply
    • Financial Samurai

      Buying property is definitely a scary thing to do given it’s probably the largest asset most people ever buy in their lives.

      I remember buying at the absolute bottom of the range I could afford because I was so nervous. In retrospect, I should have bought the most I could have afforded 2003! But, from the experience, I learned a little more for my next purchase.

      It never really gets less nerve-wracking!

      Reply
  2. LV

    Fear of failure is one of the biggest things I worry about, as well as others when it comes to taking risk. But then due to fear of failure, we then never try and have regret.

    I think it’s a good idea to envision the worst case scenario. Seldom do worst case scenarios ever appear, and therefore seldom are thing ever so bad.

    Looking back on your life and regretting not doing something has to be the worst.

    Reply
    • Financial Samurai

      I remember interviewing the CEO of a large investment bank back in 2005 when I was still in b-school for my leadership class, and “fear of failure” was the #1 thing he cited for continuing to go on even though he makes a lot of money already.

      But it is really REGRET that trumps everything because failure at least means one tried.

      Reply
  3. Dave

    Words of wisdom. I somehow became terrified of regret very early in life, while still in college. Ironically, I’m also very conservative in many ways. My advice: find a partner who challenges you. Were it not for my wife, I’d probably still be working at my first job after grad school. When I was offered an expat assignment, I was very hesitant; without pause, my wife said, “Yes, we’re doing this!”

    Reply

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