With the UFC’s historical announcement of their first female bout coming this February, MMA is getting even more media attention than normal. Whether or not you’re a fan, the strategy of fighters in the cage are more similar than you might think to sound financial practices.
Have a Game Plan
Pro fighters never “wing it” during a fight. They spend months watching videos of their opponents, train on the best moves to defeat them, and put together a round-by-round plan for using those moves. While it’s true that they have to improvise once the first bell rings, that game plan forms the structure of their decisions. Just like with your finances, they might not always be able to work that plan to the letter – but deviating from an existing plan is better than having no plan at all.
Sweat the Small Stuff
Matches aren’t won in the cage, but in the gym. It’s those thousands of repetitions of basic strikes, pushups, kettlebell swings, and mile upon mile of cardio training that really makes a champion. Winning isn’t an accomplishment, it’s a habit. Making habits of the small details of your financial life is equally key to success with your money. It’s not about the occasional major purchase or your tax return. It’s about your day-to-day spending, regularly checking your budget and the simple personal discipline to make the best long-term decision for your wallet.
Play a Conservative Game
Aggressive fighters win in the amateur leagues, but soon get “tapped out” by more skilled competitors once they go pro. To avoid this, fighters master simple moves to get out of surprise submissions, or to recover from a dizzying strike. With your finances, a “tap out” could come in the form of a layoff or job loss, or a long-term disability. Use an emergency fund as your countermove for the former, and disability insurance to protect yourself from an income-threatening injury or illness.
Fight the Whole Match
Strategy in early rounds isn’t just about the here and now. It’s just as much about setting yourself up for success later in the fight by fatiguing an opponent and inflicting minor injuries. In the final rounds, that punishment compromises a fighter enough to take advantage and force a win. With your finances, the earlier in the “fight” you see to savings, insurance and emergency funds, the better off you’ll be in your later years – and the less vulnerable you’ll be to a late-life “knockout” like an investment failure or losing your pension.
You don’t have to be a fighter or a fan to take advantage of this financial advice. Readers, what ways have you included these strategies in your own financial success? What troubles have you experienced that these techniques could have avoided?