Most of what happens to us is not a surprise. While sometimes life brings the unexpected – illness, injury, or even lottery winnings – more often than not we see the ball coming at us right off the bat. As it heads our way we generally don’t have time enough to consider all of the options. As every coach has said, we needed to have thought about our options before the ball was pitched, not when it’s on its way: What if the ball is hit to me? Where do I throw it? Who’s on base? How fast is the runner?
Then I let my muscle memory take over as I scoop up the grounder and throw it to second base to start the double play. If I bobble it, that’s an error. Errors happen; we do the best we can. If I don’t know what I’m supposed to do with the ball when it comes to me, that’s more than an error. That was preventable. That’s me letting down my whole team.
When the horse is moving along at the pace he’s comfortable with, and you accept the horse’s direction and pace, all is well and both of you are enjoying the ride. But if up ahead you see a fallen tree across your path, or if you know from having been down this trail before that there’s a sharp drop up ahead, you need to make sure the horse knows about it too. If not, the outcome is uncertain and one or both of you could get hurt. Has he jumped before? Have you? Do you speed up, slow down, stop to inspect? Like the ball coming at you in baseball, you’ve got to have thought about your options before you come up to the drop or tree blocking your path. You may choose to jump the tree, and you’ll feel exhilarated when you’re successful. Hopefully so will the horse! If you or the horse make an error, at least it was your choice. You weren’t a victim of circumstances you could have prevented. You didn’t let down the team.
So it is with life, including all the financial, legal, health, and work choices we make. By anticipating, planning, budgeting, and paying attention, we don’t have to rely on luck to reach our goals, to ensure the outcomes we want, or to enjoy our lives at 50+. When we know where we’re headed, have taken care of all the administrative loose ends – like number crunching, adequate insurance, and all the other legal requirements – we can better the odds that we’ll get to our destination, which just happens to be exactly where the horse is headed.
In the frenzy of the house-buying mania a few years ago, Pete and Diane were anxious to get in on the opportunity. They weren’t looking to make a killing by buying a house and flipping it. Rather, as a young family, they wanted a home they could live in with their two children and they feared that if they didn’t act quickly they would be priced out of the market. They saw homes for sale being bid up from the asking price and a year or less later being resold for significantly higher prices. Investing in real estate, they thought, was a safe bet. Lenders were wooing them, making them attractive offers that would make buying a home easy to manage on their budget. They offered low rates that ballooned in 5 years, and the opportunity to buy a house with almost nothing down. Who wouldn’t jump on this chance to get their starter home?
Well, of course, we all know what happened. The housing boom busted and the price of their home plummeted as foreclosures and short sales dropped neighboring homes to half the amount they paid. Then their mortgage rate jumped, doubling their payment. There were better interest rates available but they couldn’t refinance because the house wasn’t worth enough. They were stuck paying twice as much for their mortgage, an amount that stretched their budget thin, for a house that wasn’t worth but half of what they owed.
What to do? The options were few but the most obvious one rose to the top of the list: walk away. With almost nothing invested in the home, there were few downsides to this choice. Even their attorney agreed. It pained them to leave their home, knowing that their bad credit would prevent them from buying anything for years. And all they wanted was to provide a home for their children.
It’s easy to second guess, but they realized later that they never thought through the whole process or the possible outcomes. There were experienced people from whom they could have learned that the market was not going to sustain this frantic level, that the home they were buying was particularly vulnerable given the location and size, and that by agreeing to the balloon rate mortgage they were putting themselves at great financial risk.
Pete and Diane waited out the years until their credit rating was back up and the housing market had stabilized. They saved up for a down payment and just closed on a small starter home in the same neighborhood where they’ve been renting where housing prices have stayed the same or gone up slightly. They’ve sought counsel from professionals and they’re comfortable knowing that this time they made the right decision.