Lessons off Bernie Madoff
Recently as I sat at a local coffee shop in downtown Charlotte recently I couldn’t help but overhear several patrons passionately discussing the Bernard Madoff case.
“He’s such a crook” one gentleman exclaimed. “They should give him the electric chair” another woman protested. It got hot and heavy for awhile and really had me thinking about something my Dad told me years ago.
He intimated that in a crisis situation before I start pointing the finger and blaming someone else for my problems I need to first check-in with the man-in-the-mirror (my dad said it way before MJ, but we love you for that song anyway Mike – RIP).
In the many years since my dad’s death I’ve had the opportunity to reflect and contemplate his statement on many an occasion. My years in the finance business working with client after client revealed a dire lack of accountability on the part of clients who flatly refused to take personal responsibility for their own financial minefields.
Often I’d develop compelling arguments as to why a couple needed to be involved in their financial makeover so as to learn the basics of what to do and not to do. “Can’t we just pay you to do it for us without being involved?” was the answer I would hear more often than not. I became exhausted with “fixing” a client’s situation only to have them present me with a new bag of goodies (debt, late payments, etc.) 6 months later.
When I consider this Madoff case I ponder how all these supposedly-intelligent and savvy individuals could look at that man or woman in the mirror every day and not hold him/her at fault. They blindly trusted this man who really couldn’t be trusted. How could this happen you say? Where was the S.E.C….(that’s another story).
As far as this situation goes it all starts with poor stewardship. Individuals who, like many of my former clients, refused to take personal responsibily for their own money management. “I don’t have the time”, “I’m not good with numbers” or “My wife handles that” are some of the poor excuses I’ve heard.
Now we are faced with the most horrific financial scam of our nations’ history. And while the victims are applauding the conviction as well as the 150 year sentence they still fail to see the forest for the trees. What Americans still don’t realize is that unless and until we turn off noise of the flat screens, two-ways and I-pods it’s only a matter of time before history repeats itself.
Robert Kiyosaki has preached fiscal responsibility in his numerous best-sellers. However, it’s the same basics grandmom and grandad taught our parents years ago. Have we become so modernized that we can’t do anything for ourselves any more? The irony of it all is that it seems the more sophisticated and advanced we’ve become educationally and technologically, the worse financial decisions we make.
So you couldn’t afford to pursue a degree in finance from Harvard University? Well, that’s understandable. However, for most a Harvard-level education is now availible to the common man or woman today via the world wide web. Never have we in the history of mankind has such a myriad of data and information been available to us right at our fingertips. And the only way for us to change our results is in fact, to change our actions.
Please, please don’t misunderstand my point. There are (still) a few good money managers out there today. However, the magic elixer is YOU. You are the best manager your finances will ever have. There is only one person who’s going to take care of your money like it really matters and that is you.
Many people had no clue what there precious dollars were invested in. They knew nothing about the myriad of “investments” or the background of the companies. This is a cardinal sin and one of the first and most basic rules of investing. You should never invest in an industry you are intimately familiar with….ever.
And at the end of the day you should be directing the money manager to a large extent, not he or she selling you on the latest hot stock tip. It’s time to take charge of your finances again. Otherwise we may as well prepare ourselves for a few more Bernie Madoffs to be uncovered in the years to come.
I’d like to suggest it’s time to get back in the driver’s seat and take the wheel of your financial future. One thing i can say for Bernie is that he opened our eyes! You can choose to make a change or do nothing at all. The choice is up to you!
~ Jerry King. Jerry King is an Examiner from Charlotte.
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Lessons off Bernie Madoff
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