Each summer golf’s emerging talents tee-off in Alberta - but what exactly goes into becoming a golf pro? As viewers, we often don’t get to see the practice, planning, and coaching that goes into making every shot count. These factors heavily influence the outcome of a player’s game, but as an amateur golfer and investor, what can you learn from this?
Actually, a lot more than you would think. There are many similarities between what it takes to become an expert golfer and what you need to be a successful investor. If you’ve spent a lot of time on a golf course or watching the pros on TV, your golf knowledge may come in handy while planning for your financial future. For those of us who are not quite PGA grade, let’s take a look into how these golf stars prepare for each game - and how these learnings can translate into investing success.
Assemble a team of support staff.
Long before the tournaments even begin, professional golfers’ employ a team of support staff to aid them. From caddies to coaches to sports psychologists, each team member plays a crucial role in the success of the golfer. As amateur golfers, it can be hard to put together a team this large, but as an investor, it’s quite simple. Here’s who you need on your financial journey to maximize results:
- A private banker who, much like a pro golfer’s caddie, helps with the day-to-day banking needs of a client and frees up time in their lives.
- An accountant who manages and implements tax strategies for clients, similar to the strategy support a caddie provides.
- A financial advisor who often plays similar roles to both a golf coach and sports psychologist, all in one. Among many things, an advisor helps identify investors’ goals, assesses their knowledge and risk tolerance, and builds a financial plan to meet their clients’ goals. They help implement an investment strategy while serving as a behavioural coach to help keep the investor disciplined and focused on the plan.
Be strategic, make a game plan.
Another commonality between a professional golfer and successful investor is their commitment to implementing a plan. For a professional golfer, this means constructing a plan of when and where to attack the course, as well as remaining patient, focused and disciplined to that plan throughout all 18 holes.
A successful investor will implement a financial plan that includes how they will reach both their short-term (the next hole) and long-term (all 18 holes) financial goals. This serves as a blueprint to keep investors focused on what’s important and allows them to remain disciplined with their strategy through the possible short-term noise market volatility can bring.
Without a plan, both the investor and the golfer are simply swinging blind and making ad hoc decisions which, over time, may not be consistent and intentional enough to outperform their competition or reach their financial goals.
Create consistency by assessing all the variables.
Every time a golfer steps up to swing they need to take many variables into consideration. Variables such as lie, wind, yardage, elevation, green firmness and temperature will ultimately impact the success of their shot. Because of this, professional golfers and their team have refined a process that helps them make educated decisions, producing consistently better outcomes.
Successful investors utilize a comparable framework. Rather than considering one variable, like the dividend of a stock (or if you’re golfing, yardage), effective investors will consult financial experts who can help them assess all the variables that can affect the likelihood of them reaching their financial goals. For example, a financial expert can use financial modeling to take life expectancy, tax rate, tax strategies and expected return on investment into account when developing a sustainable retirement income goal that can last over 25 years.
An investment process, when combined with a detailed financial plan, creates a strong financial strategy that can help you make better decisions during periods of financial stress and mitigate risk for better long-term results to achieve your life goals and dreams.