Chess and Personal Finance: Only One is a Game

Chess is a game. Personal finance is not, period. It's your future! If you rely on financial celebrities and their cutesy marketing slogans, logical fallacies, and bullying to drive your decisions, then you're setting yourself up for failure. Do not fall victim to thinking personal finance is something to be toyed with. If you approach personal finance like a game, then you'll have no respect for the possible defeat you face.

Using chess as an illustrative example, we'll show you just how complex a game can be and why decision-making in personal finance is more important than a cookie-cutter approach to life problems you'll encounter.

There are 6 unique pieces in chess and 32 total pieces: 8 pawn, 2 rooks, 2 knights, 2 bishops, 1 queen, and 1 king per player. Each piece has its own particular way of moving and attacking the opponent's pieces on the 64-square board.

After both players move initially, there are 400 possible board setups; after the second round, 197,742; and after the third round, 121 million. Let that sink in...121 million possible board setups after just 3 rounds of play.

It's possible to beat your opponent in these 3 rounds despite there being 121 million board setups. Amateurs often gain false confidence with this information, especially after a winning against other amateurs. They follow a cookie-cutter approach with a prescribed sequence of opening moves and believe they are good chess players. This may work against 20 million other people, but it doesn't mean it's the best approach for you because there are defenses for the "beat your opponent in three easy moves" strategy. Any experienced player will leverage them, humiliating you with a quick and decisive defeat. If you come to a chess game thinking you'll win in three moves, then you've already lost.

It's fine to have a repertoire of opening moves, but what happens when your opponent interrupts your plan? You have to be able to adapt. This is true for anything in life, especially personal finance. Emergencies will happen. There are far too many variables for you to rely on a prescribed approach that limits your options. Your life has an infinite number of "board setups" and any financial celebrity who advocates "seven baby steps to solve all your problems" is a poor excuse for a teacher.

Would your chess teacher be able to analyze 121 million solutions in your game (and that will get you just to the third round) and tell you how to move? Imagine if you paid your chess teacher $1.00 to analyze every possible board setup (this is what computers do). They'd be a happy person by Round 3. And you'd be deeper in debt.

If you want to have the best chance of winning at chess and anything else in life, you have to think. Critical thinking, knowledge, and sound decision-making about any endeavor is necessary if you expect to survive more than a few moves. In chess, you need to know not only how the pieces work, but also how to develop and execute a strategy for putting your opponent in checkmate while avoiding it yourself. You have to play aggressively at times; conservatively at others. Chess is simple to learn. Difficult to master. Life, exponentially so.

Like chess, personal finance doesn't lend itself to cookie-cutter approach, especially when circumstances change or when you encounter a situation your favorite financial celebrity hasn't screamed about on his podcast (or if you haven't bought his $129/year "Ramsey+" subscription that explains everything under the sun).

Likewise, will your personal financial celebrity be able to give you a solution for every situation you encounter? They may know the solutions, but even if so they don't have enough time on their podcasts to hold your hand through every one of them. Besides, you don't have access to them 24/7. You'll have to hope you get through on the lines and that they address your issue. If it's not sensational, then they're not going to answer you at all. In fairness, some celebrities partner with "local provider" who will gladly accept your money to teach you things you can learn for free from any public library or Websites.

Your best option is to understand what works and what does't and employ your own methodology. This is why The Stone Money Foundations are a superior alternative to Dave Ramsey's inflexible Baby Steps and other programs that prohibit free thought. Money Foundations gives you the flexibility to decide upon what's best and adjust your course of action when necessary. They're free and adjustable to what suits your needs.

During a chess game, you can't call your teacher for help. In the game, it's just you and your opponent. No one is going to bail you out when your opponent is putting the pressure on you. And if you don't know what you're doing, you'll lose the game in about three moves. A game is a game, but real life is unforgiving. Don't jeopardize your future by treating your personal finance as a game.

Develop a winning strategy for personal finance by adopting a sound philosophy and employing a methodology that not only works, but is also adaptable. Use critical thinking to develop solutions for new and difficult problems. This is how you win (and you don't even need cutesy slogans or logical fallacies from your favorite financial celebrity).

Image by kostkarubika005 from Pixabay

#StoneMoneyFoundations #Ramsey #BabySteps #RamseyPlus