Editor’s Note: Jason Payne is a former Wall Street research analyst and founder of the Groundwar Group – a management consulting firm providing premier corporate advisory services, leadership training solutions, and investment analysis capabilities for business leaders and investors around the world.
In addition to offering his firm’s helpful services at a substantial 50% discount to all Mogul members who request a FREE exploratory consultation through Groundwar Group’s new Facebook page or new Twitter account, Mr. Payne pens this ongoing “Profits & Prophets” series to help our entire Mogul community develop a more profitable mindset about business, investing and life itself.
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From Jason Payne, Management Consultant & Leadership Coach …
You are going to die.
It’s true.
One day – whether years from now or perhaps this very evening – your heart will cease to beat, your lungs will cease to breathe, your synapses will cease to fire, and life (as you currently know it) will cease to exist.
And you are entirely powerless to avoid this inescapably conclusive outcome. It cannot be conveniently plucked from the horizon of your life. You cannot remove it from your personal “To Do” list.
No vast sum of money can purchase your freedom from death’s unrelenting grip. Just ask Andrew Carnegie, Cornelius Vanderbilt, Sam Walton and John D. Rockefeller. (Oh, wait… You can’t… Because they’re all dead.)
No magnitude of political power or influence can halt your body’s unceasing march to the grave. Just ask Alexander the Great, Julius Caesar, Genghis Khan and Darius I. (Oh, yeah… They’re dead, too!)
And no amount of education or intelligence can teach you how to outmaneuver your ultimate fate – which explains why you also cannot ask Albert Einstein, Isaac Newton, C.S. Lewis and John Lennon. (All dead! Though there is much debate about that last one ...)
Yes, the truth of the matter is quite unavoidable: Everybody is most assuredly going to die – including you.
And it’s a good thing, too.
Because the inevitability of your death is the greatest resource on earth for generating profitable investments during your life.
That’s right. The certainty of your impending demise is the single most valuable asset in your entire portfolio …
Death & Investing
According to this famous stand-up act by comedian Jerry Seinfeld, death is the average human’s second greatest fear – outmatched only by an irrational fear of public speaking.
However, my own research suggests the fear of death is actually humanity’s greatest fear – even greater than the fear of public speaking (which ranks nowhere near the top of my list). And this thoughtful conclusion appears to be supported by common sense, as well. After all, it is quite rare to find a mortified groomsman who will choose to commit suicide instead of publicly toasting his newlywed friends.
In any case, the fact remains that many people are supremely terrified of death.
Simultaneously, it is also true that most investors are supremely poor stewards of their money. Even Wall Street’s best research analysts were caught off guard by the recent financial crisis and subsequent recession. (How do I know? Because I used to work with them.)
So here is a concise summary of our current state of affairs: Many investors are both afraid of death and unwise in their investments.
Coincidence?
I think not.
In fact, I am convinced that most forms of folly and waste in this world – both monetary and otherwise – are driven primarily by (i) unhealthy fears of death and (ii) unhealthy views of life itself.
Show me a man who is afraid to die, and I’ll show you an investor who is not getting the most out of his portfolio.
But show me a man who lives with no fear of death, and I’ll show you an investor whose portfolio is exquisitely streamlined and strategic. (As is his entire life.)
The investor who has adequately prepared for his own certain death is equipped by an unshakable and unrelenting motivation for comprehensive profitability – in all its various financial and non-financial forms.
As a wise man once said, “He who does not know how to die cannot know how to live.”
How to Waste Your Money (and Your Life)
The incorrect manner for thinking about death is to fearfully ignore the voice in your head that occasionally broaches such "taboo" subjects.
You may instruct those thoughts to simply “go away”, and they may indeed disappear momentarily … But at what cost? Contrary to what we learned in Economics 101, opportunity cost involves all types of profit and is not limited to mere financial gains.
For example, you may be evaluating a new investment strategy (or reading an investment-related blog from Real Estate Mogul) when you quite unexpectedly begin to consider your own mortality. This heightened awareness of your impending death seems to come out of nowhere – yet it confronts you boldly, like an oft-spurned landlord who preemptively reminds his tenants about next month’s upcoming rent payment.
Fearful of what death has to say about the current condition of your life, you may choose to ignore such thoughts by doubling your focus on the specific investment strategy at hand.
You may even find momentary comfort in fleeting rationalizations, such as this common example:
“The investment strategy at hand represents a near-term deadline, whereas the deadline for my mortality is sure to be far off in the distant future. I am therefore wise to focus on this near-term investment strategy today, because I can think about death’s implications tomorrow.”
Perhaps you are correct about the timing of your death. But perhaps you are mistaken. Do you really want to take that particular risk, both financially and existentially?
After all, you cannot play such games forever. The house always wins. If you ever find yourself to be mistaken in this dangerous game – even once – then your money will not be the only thing that is wasted.
In this sense, the investor who fails to look his future death square in its eyes is like the driver of an automobile who fails to look past its speedometer. The foolish driver may be able to carry on for a little while without ever focusing beyond his own dashboard, but it will not go well for him in the long run. Although he carefully controls one important measurement (speed), the nearsighted driver will eventually get lost, or crash his vehicle, or both.
It is only when a driver focuses on the distant horizon that he can successfully manage each component of the vehicle in which he rides. Of course, he must occasionally glance at the vehicle’s various gauges (speedometer, odometer, fuel, etc.), but a wise driver never confuses the importance of such tiny measurements with his most important objective of all – successfully completing the journey that stretches out before him.
Similarly, it is only when an investor focuses on his life’s long-term horizon that he can most profitably steer his near-term investment activity.
In fact, this is the only way to be truly profitable in any endeavor …
The Correct Way to Think About Death & Investing
You see, the correct way for an investor to think about death is to prepare for it daily.
Death is your portfolio’s ultimate deadline (ie. “dead”+“line”), and your preparations for this unavoidable fate should take precedence over your management of all lesser deadlines and milestones. In fact, as you build your life to accommodate a supremely satisfying and meaningful death, you will begin to find all your lesser deadlines embodying a heightened sense of significance and urgency – both financial and otherwise.
I think this is a small part of what Jesus was talking about when he wisely said that whoever seeks to preserve his life will lose it, while whoever loses his life will find it.
For example, the aforementioned investor (who chooses to ignore his mortality today in order to focus on a near-term investment deadline) may easily divert his attention to the wrong investment strategy. Of course, he may be correct in supposing the investment’s near-term deadline is closer at hand than death itself …
… and he may even be correct in evaluating the given strategy to represent immense financial profitability …
… but what if it is not the best strategy for building a profitable life? Moreover, what if it is not the best strategy for building a profitable death?
What will it profit a man if he gains the whole world and forfeits his soul?
Yes, “profit” is a tricky word. Its definition hinges entirely on the one thing to which you ascribe greatest value in this world.
Therefore, an investor will never know which investments are truly best for his life unless he first knows which sort of life is truly best for his death. The automobile owner should never begin to drive until he knows exactly where he wishes to end up.
Some Practical Advice
So rather than fearfully ignoring your occasional thoughts about death, dear Mogul, embrace them with vigor and entertain them thoughtfully in the forefront of your mind. It’s one of the best favors you’ll ever do for your business – and your life.
But don’t turn into one of those depressing emo kids at the mall! (Seriously. There’s an epidemic of them here in Memphis – looking all hopeless and depressed while sitting outside the Hot Topic outlet store.)
If the thought of your impending death fills you depression or fear, then it is probably due to at least one of the following problems:
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No Mission Statement. If you don’t have a mission statement for your limited time on this earth, then you lack the capacity to define what it means to have a “profitable” investing career.
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No Execution of the Mission. If you are not successfully executing your life’s mission, then you will feel increasingly depressed and fearful as your ultimate deadline gets nearer each day.
Don’t have a mission statement for your life? Make one.
Don’t know how to make a mission statement for your life? Try this …
If you believe death is the end of the line, then figure out what epitaph needs to be written on your tombstone. (Hint: It probably won’t have anything to do with that near-term investing deadline.)
Conversely, if you share my belief that the conclusion of this life merely opens the door to a subsequent afterlife, then figure out what words will need to be exchanged when you eventually meet your maker. (Hint: God might not be too interested in your mastery of my recent lesson about mortgage arbitrage.)
Either way, you’ll be equipping your investment portfolio with a uniquely powerful context in which to profit and thrive.
And once you have identified the death you need to die, then you may begin to truly pursue the life you need to live – both financially and otherwise. Indeed, you will find it impossible to do anything else!
Because the profitability of your entire existence depends on it.
The next installment of Jason Payne’s ongoing “Profits & Prophets” series is currently scheduled to be published on Monday, March 31st.
Embrace Your Mortality – Embrace the fact that you will eventually die.
Craft a Mission Statement for Your Life – Since life is short, craft a mission statement for your limited time on this earth.
Don’t Waste Your Money or Your Life – Execute your life’s mission with unparalleled enthusiasm and vigor. Involve all areas of your life, including your investment portfolio.
Beware the Emo Kids – Emo kids totally miss the point! This life can be a beautiful, profitable and satisfying experience -- if approached the right way! I’ll explain more in future lessons, God willing …