- Willy Wonka is an entrepreneurial genius.
- Make a plan and focus on the long game – whether it’s the stock market or estate planning.
- Read the fine print.
In the first few minutes of Willy Wonka and The Chocolate Factory (1971, starring Gene Wilder), the Wonka factory rises above an impoverished town as a thriving and magical dreamland. If you’ve ever taken a film class, the factory is a textbook case of visual metaphor. It’s the epitome of innovation and successful business development (and let’s not forget endless candy), but it didn’t rise to that stature and global fame without a few critical moves from Willy Wonka himself. Think about it, he manages not only to keep a business running but makes it thrive during a major economic downturn (partially due to unpaid labor a.k.a. Oompa Loompas, but let’s look past that for now) and he’s got everyone spending their last pennies in a lottery style scheme for the unlikely chance to uncover a golden ticket.
Willy Wonka is an entrepreneurial genius whom we all can learn a great deal from.
Never one to shy away from turning a phrase or two, here are five times the famous candymaker’s “wonka-isms” can be applied to your personal finances:
1. “We are the music makers, we are the dreamers of dreams.”
If you dream it, you can make it happen. Caveat – it’s okay to bake in passion projects, major vacations, or a dream house to your budget as long as you don’t neglect your key financial accounts, like an emergency fund or retirement savings. The trick to accomplishing both is setting up a plan the day you decide it’s a dream you want to make real. First step, download the Personal Capital app and use the Retirement Planner tool to see how your accounts are doing and what financial goals you need to hit to reach your dream.
2. “So much time and so little to do. Wait a minute. Strike that. Reverse it. Thank you.”
No one wants to sit down and dissect every little thing they spend money on or delve into the overwhelming task of devising a retirement strategy, at least not by themselves. So don’t. Recruit a licensed financial advisor to do the heavy lifting so you don’t have to worry about tax loss harvesting or asset allocation. After having a conversation about your financial priorities and goals, your job becomes simply to open your go-to money management app, such as the Personal Capital one, then track your spending, set your budget, follow your savings plan, and check up on your investments from time to time. I guarantee you, Willy Wonka didn’t spend his days crunching numbers – he was devising new flavors! Now you too can get back to making world-class chocolate or being a baron by some other means.
3. “I’m very pleased to hear you say that, because I’m giving it to you.”
This is the definition of an inheritance. When you’re creating an estate plan and deciding who your legacy will be like Wonka did, it’s important to choose a worthy candidate. It’s also important to think about what exactly you will be giving away. Are you thinking about putting money into a trust fund? Or gifting a house? There are different tax strategies for every option, so make sure to consult a professional before you put anything in writing. They might even be able to help you gamify inheritance and create a heated competition for rare and valuable gifts – or tickets hidden inside tasty treats. Your choice.
4. “Is it raining? Is it snowing? Is a hurricane a-blowing? There’s no earthly way of knowing, which direction we are going.”
The stock market is a fickle, fickle thing. Everyone knows it’s as unpredictable as the wind and those who try to play market timing often lose. As reported in Financial Advisor magazine*, “The chart below, produced by Morningstar, illustrates how [selling securities after they’ve fallen in value and then hesitating to reinvest] hurts investors who were bitten by significant losses during the financial crisis[…]” The Personal Capital philosophy is to play the long game, stick with a plan, and rebalance as necessary. More often than not, staying the course will allow your investments to recover at a higher value than if you had exited, or hesitated to reinvest.
*Financial Advisor magazine, The Difficulty And Costs Of Timing The Market by Chris Meyer published on June 15, 2015.
Regardless of stock movement, make a plan with your financial advisor and be sure to update it as needed every year. You don’t want to get caught in an economic storm without an emergency preparedness kit – or a magic elevator that breaks through glass ceilings and turns into an aircraft…
5. “I, the undersigned, shall forfeit all rights, privileges, and licenses herein and herein contained, et cetera, et cetera… Fax mentis incendium gloria cultum, et cetera, et cetera… Memo bis punitor delicatum!”
It only takes half a glance at this kind of language for 99% of people’s eyes to glaze over and never look back. But this is exactly the kind of language you need to be paying attention to, especially when it comes to your money and investments. For example, do you know how much you’re paying in investment fees? How about advisory fees to your broker? When was the last time you checked? Have you ever? Hidden deep in legal documents and shrouded in technical jargon is where financial institutions claim to disclose their investment and management fees. The easiest way to find out how much you’re actually paying is by using the Personal Capital Fee Analyzer tool in the free app.
I invite you to make a bowl of popcorn and watch the 1971 classic Willy Wonka and The Chocolate Factory from a whole new perspective.
What are some of your favorite wonka-isms? Tell us in the comments!
The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.
Any reference to the advisory services refers to Personal Capital Advisors Corporation, a subsidiary of Personal Capital. Personal Capital Advisors Corporation is an investment adviser registered with the Securities and Exchange Commission (SEC). Registration does not imply a certain level of skill or training nor does it imply endorsement by the SEC.