Your Pieces

Jigsaw puzzles date back to the eighteenth century (1760s) and originally started as an educational tool. John Spilsbury, an engraver and mapmaker, is credited with inventing the first jigsaw puzzle in 1767. Since that time, puzzle popularity has ebbed and flowed and the themes have changed. In the beginning, puzzle pieces did not interlock and sometimes you didn’t even have a picture on the box to tell you what you were going to be putting together–all you had was a theme or a title of the puzzle, so your mind was left to imagine what the puzzle was supposed to look like, while trying to put together pieces that didn’t necessarily have transition pieces (for example, part of the sky and part of the house on one piece, helping you “connect” it with other pieces). The use of “jigsaw” in the title is actually a bit interesting as well, since most puzzles weren’t actually cut using a jigsaw but rather a fretsaw…I guess “fretsaw puzzle” just didn’t roll off the tongue as well…

If you’ve ever put together a puzzle, you know that it can be a challenging task. Our 4 year old is in love with puzzles right now and they serve multiple functions in her development: teaching geography, numbers, animals, pictures, etc. while also teaching her patience, trial and error, memory, and imagination skills.

One night she was trying to put together a puzzle that she had never done before and, as most 4 year olds would act, started to get impatient rather quickly. Even though she started off with the corner pieces and started to work her way around the borders, she was still struggling getting some of the middle pieces to fit and wasn’t quite sure how it was to be put together. We worked through it and she successfully completed the puzzle, but reflecting back on that activity made me realize a couple of things as it relates to personal finance.

Similar is not good enough

There were a couple of pieces that she had put together in the middle of the puzzle that she thought had fit together. Upon Dad helping her, though, it was apparent that she had found a piece that was similar in size and shape to the one that belonged in that spot. However, by her unknowingly forcing that piece into the incorrect spot, the domino effect caused the rest of the puzzle to frustrate her and not come together as it should. Eventually, she threw up her hands and came to us, almost in tears, asking for help.

The same can be said for the pieces of your personal finance puzzle. There may be situations and circumstances where you have something in your plan that you think is where it belongs, but it’s just not working the way that it should. It may be the way your investments are allocated. It may be the type of insurance that you have in place. It may be your estate plan and how you want your family to be taken care of should something happen to you. It may be the way you’ve done your tax planning.

It may also be that the pieces that you started with at one point in your life are no longer the pieces that you need given the way life and your circumstances have changed. The pieces of your financial puzzle, unlike a jigsaw puzzle, are dynamic and always changing. Reviewing those pieces to make sure they all fit together is a great way to make sure you’re on pace to completing the puzzle.

The box helps

While putting together a puzzle for a 4 year old is a great activity, it’s an activity that can instantly be harder than it should be if you don’t know what you’re putting together and what the finished picture is supposed to look like when you’re done.

What’s the first thing that you usually do when you dump out the pieces of a puzzle you are attempting to put together? You turn the box over to the cover, place it next to you, and continually reference it so that you can measure your progress and ensure you’re as accurate as can be as you put it together.

The same can be said for financial and investment planning. Blindly attempting to put together the pieces of your puzzle without knowing what it’s supposed to look like can be time-consuming, frusrating, and costly. Making the wrong financial decision doesn’t typically happen in a vacuum–there is usually an opportunity cost that is lost when making that decision, and in the process of making that decision you lose part of the one commodity that is one of the most precious and finite resources we all have: time.

So how do you build your box?

With a financial plan.

I know, sounds boring. Candidly, it is. No one (or very few people) wake up and think that today would be a great day to “build my financial plan” (i.e. build my puzzle box). But most people do have financial dreams, goals, and aspirations that they want to achieve in life. Whether that be pay off their student loans, buy a house, start a practice, fund their kid(s)’ education, build towards their own financial independence, or other goals…all of these intentions begin to form the picture that make up your (financial) puzzle box…and each of them will require very specific pieces in order to put it together correctly.

But it doesn’t happen without intention and action. Be intentional about your progress as you assemble your puzzle. If you don’t have a box, now is the time to build that plan…on your own or with the accountability and guidance of a trusted advisor.

Einstein is quoted saying “No problem can be solved with the same consciousness that created it.” If you want the circumstances of your life to change, you must change the input to affect the output.