For most people financial decision-making is like driving a car on a public street. Traffic signs and the very roads themselves serve as boundaries for what you can and cannot do — where you can and cannot go. Your budget and account balance are like the signals on a traffic light. Green for go, yellow for caution, and red for DO NOT BUY that big screen tv.

When assets and income increase to a certain level, decision-making by these fixed limitations is no longer relevant. You can pretty much afford to purchase whatever you want. If you are no longer limited by you account balance, the the light is almost never red.

At that point financial decision-making is more like sailing a ship. No longer bound by roads and signs, you are free to go (to spend) however and whereever you wish. There are no road signs and no boundaries.

As your assets increase further, it is like sailing out of sight of land into the open seas where not only are there no limitations, neither are there any reference points to remind you where you are or where you are headed. So how do you decided what is right or wrong, wise or foolish? Of course, you can spot another ship and follow them, but you don’t really know whether or not they are lost or if they are headed to a place that you want to end up.

Like sailors who learned to navigate by the stars using a sextant and compass, being a steward of significant wealth requires another set of navigational skills.

More about that later.

Walt Walker

Franklin, TN