What baseball can teach you about financial planning

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Spring training is a tradition that baseball teams and fans look forward to every year. No matter how they did last year, teams in spring training are full of hope that a new season will bring a fresh start.

Below are a few lessons from America’s favorite pastime that might help you reevaluate your finances.

Proceed one base at a time
There’s nothing like seeing a home run light up the scoreboard, but games are often won by singles and doubles that get runners in scoring position through a series of base hits. The “one base at a time” approach takes discipline, something that you can apply to your finances by putting together a financial plan. What are your financial goals? Do you know how much money comes in, and how much goes out? Are you saving regularly? A financial plan will help you understand where you are now and help you decide where you want to go.

Cover your bases
Baseball players minimize the odds of a runner safely reaching a base by standing close to the base to protect it. Protect your financial future by preparing for life’s “what-ifs.” For example, buy the insurance coverage you need to ensure you and your family are protected. Also, set up an emergency account that you can tap when an unexpected expense arises. 

You can strike out looking, or strike out swinging
Every baseball player knows that striking out is a big part of the game. In fact, striking out is much more common than getting hits.

When it comes to your finances, accept the fact that you’re going to have hits and misses, but that doesn’t mean you should stop looking for financial opportunities. When investing, you have no control over how the market is going to perform, but you can decide what to invest in and when to buy and sell, according to your investment goals and tolerance for risk.

“What’s nice about investing is you don’t have to swing at pitches,” said Warren Buffett. “You can watch pitches come in one inch above or one inch below your navel, and you don’t have to swing. No umpire is going to call you out. You can wait for the pitch you want.”*

Every day is a brand-new ball game
When the trailing team ties the score, the announcer shouts, “It’s a whole new ball game!” Or, as Yogi Berra put it, “It ain’t over ‘til it’s over.” Whether your investments haven’t performed as expected, or you’ve spent too much money, or haven’t saved enough, there’s always hope if you’re willing to learn both from what you’ve done right and from what you’ve done wrong. Pitcher Bob Feller may have said it best, “Every day is a new opportunity. You can build on yesterday’s success or put its failures behind and start over again. That’s the way life is, with a new game every day, and that’s the way baseball is.” 

*All investing involves risk, including possible loss of principal.

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2016. 

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