While flying home from Salt Lake City yesterday a fellow pilot taught me a valuable lesson in investing. First of all, it’s important to understand that airplanes do not typically fly in a straight line. There are roadways in the sky to facilitate the organized flow of traffic. But like most of us, pilots love to take shortcuts and often request them. On this flight a commercial pilot asked for, and received a shortcut on his route, for which he expressed gratitude. Curious about the real effect, I took out my map and pencil and realized the shortcut given would save the pilot about 1 minute of flight time.
My first thought was the pointlessness of the request, but then I decided to do a bit more calculating. The regional jet at issue has an hourly operating cost of about $4000. That means every minute in the air costs the company $66. If that jet flies between Salt Lake City and my home airport of St. George four times a day and the pilot is granted a one minute shortcut on each leg it would save the company $264 per day. Over the course of a year that single regional jet would save nearly $100,000 in operating costs. I decided that rather than think it a silly request, I should contact the airline and suggest they put a nice bonus in that pilot’s paycheck.
In all areas of endeavor, it is the big things that get the most attention but usually the little things that make the most difference. In my investing years I have occasionally bought a stock, or a piece of real estate and made a great profit on it. These are the kind of things all investors love to brag about. But when I look at the whole of my financial picture I realize that most of my personal wealth has come from the little things I have done every day throughout my life. The regular payroll deductions into savings accounts, the faithful adding of a little extra principle to each mortgage payment, even the family rule that we only order water in restaurants, are all small actions, little shortcuts you might say, that individually mean very little but collectively have had a significant impact. The big wins are fun to talk about, but the little things really deserve the credit.
I have worked with thousands of successful investors and there are certainly those few who made it big in a single action. The vast majority however have learned, like myself and my fellow pilot, that it is the small and seemingly little things that we do everyday that are most likely to lead to a successful financial finish to our life. Each of us will have our big wins, and likely our share of failures, but life ultimately rewards those who do the “right” little things over and over again; Even though to others they may seem so insignificant.
Hi, I'm Dan. I'm a CFP® Professional.
Securities and advisory services offered through Commonwealth Financial Network®.
Member www.finra.org / www.sipc.org , a Registered Investment Advisor. Wyson Financial, 375 E Riverside Dr, St. George, UT 84790
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