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  • Writer's pictureThomas Hayes

Luck, Opportunity, and Controlling What You Can

I recently finished reading Morgan Housel’s new book, Same As Ever: A Guide To What Never Changes, and one quote from the book that really stuck with me is, “So much of the world hangs by a thread”. I found one example of this idea from the book particularly interesting. During the American Revolution, at the Battle of Long Island, George Washington’s army was nearly wiped out by the British Fleet, save one stroke of luck. All the British fleet had to do was sail up the East River, finish off Washington’s troops, and likely end the American Revolution. However, on that August night in 1776, the wind wasn’t blowing in the right direction for the ships to make it upriver. A stroke of luck that saved Washington’s army, and likely saved the United States of America as well.

This story has me thinking a lot about my own life, and what seemingly inconsequential decisions led me to where I am today. With the holiday season approaching, I certainly have to be thankful for all the luck I’ve had, noticed or unnoticed, that led me to this point. My father always repeats the famous quote attributed to the Roman philosopher Seneca, “Luck is what happens when preparation meets opportunity.” Which he used to follow up by saying, “You make your own luck.” However, you never know what seemingly inconsequential decision will lead to that opportunity, and alter the course of your life. I think that is the essence of luck. To make it work in your favor you have to be prepared when opportunity strikes, but the opportunities you get often come from the most seemingly inconsequential decisions.

That famous quote had me thinking back to how I became a full-time financial advisor. A friend of mine that had moved to Washington was coming back to Massachusetts for a trip, and posted on social media to see if anyone in the area wanted to meet up for a drink. I hadn’t seen him in almost 10 years at that point, but I decided to reach out, and we met up in Boston where he was staying for a few days. He was surprised to hear I didn’t actually live in the city and had made the drive out there to see him. While we were together, I told him how I had just left my job in compliance and was thinking about becoming a full-time financial advisor. When I explained my situation, he told me he had just seen our former high school lacrosse coach, who was now a financial advisor with LPL, and I should consider giving him a call. The rest is history. This one inconsequential decision, that I put almost no thought into at the time, had a major impact on my life.

These random events are something to keep in mind next time you hear a financial pundit making predictions about the future. Predictions tend to be an extrapolation of the current state of the world, with the forecaster trying to factor in all of the known risks. The problem is that a seemingly inconsequential decision, or random event, can have a massive impact on the future, which is why humans are terrible at predicting it. Instead of focusing on what the future holds, when focusing on your investments, “make your own luck” by focusing on the things that you can control. It puts you in the best possible position to take advantage of whatever opportunities arise. You can’t control future tax rates, the future of inflation, future market performance, the future political picture, and you can’t predict much else about the future state of the world with any certainty. So focus on your savings rate, on maintaining an asset allocation that you feel comfortable with, on minimizing lifestyle creep, on making sure you have the right amount of insurance coverage, on trying to learn new things to progress your career and increase your earning potential, and anything else that doesn’t rely on the future state of the world, because as Morgan points out in the book “So much of the world hangs by a thread.”

Disclaimer: The opinions voiced in this article are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investments may be suitable for you, consult the appropriate qualified professional prior to making a decision.

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