(noun, etymology Dutch from ‘boedel’: estate, possession, inheritance, stock.). 1. Crowd, pack, lot, as in ‘the whole boodle.’ 2. a. Counterfeit money b. Money acquired or spent illegally or improperly, particularly when used in bribery for political purposes. 3. Slang for money in general.

The Satisfied Skunk

Posted on: May. 31, 2011  |  By: Ronnie Kahn  |  Category: General

Around twenty years ago, I started out in the financial services industry.  While my goal was to become a Certified Financial Planning practitioner, I had to go through the courses and pass that exam in order to start my own firm.   In the meantime, I started learning the ropes while hoping at the time that I would be able to make a living in the insurance industry until the time when I would be able to transition into planning.  I found meeting with clients not only an invaluable experience but very rewarding as well as I found each person’s story fascinating.

At the time, my insurance manager encouraged me to look into many of the existing policyowners as he felt they were much underserved.  The idea was that their circumstances and needs may have changed and since they were already believers in insurance that was a good place to start.  I received computer printouts of the policyholders that no longer had existing servicing agents.  Since there is a high industry turnover rate for agents, there were quite a few candidates.  Being in the San Fernando Valley of Southern California, I started calling many of these folks and they were pleasantly surprised that someone cared enough to check in on them.   I scheduled an appointment with as many as I could just to make sure that everything was in order such as beneficiaries, things called dividend options which stated in what form their policy would receive the company issued dividend, and so on.

Many of these policyholders had purchased these policies a number of years before.   Many of these persons were now retired.  With each interview, we would discuss why they purchased these policies in the first place and what their current situation was now.  After a while, a pattern emerged where a somewhat disproportionate number of these folks were formerly employed by Lockheed.  Each one seemed to tell a story where they came to California looking for opportunity.  It seemed that Lockheed was hiring and training engineers as fast as they could.  None of these individuals seemed to have any prior background or education around being engineers yet they found themselves being groomed for a field that was intensely needed by the Aerospace industry at the time.

I was fascinated by the stories they had to tell and from my manager’s standpoint probably spent far too long on each appointment from a productivity standpoint.  At first, when I began the interview, each person seemed a little bit matter of fact and politely distant.  As soon as the discussion hit their Lockheed background they began to perk up.  What I especially noticed was the gleam in their eye and surge of pride when each one mentioned Skunk Works.  Skunk Works was the team approach that developed many of the famous aircraft designs.  More to the point, Skunk Works has become synonymous in the field of engineering along with the fields of management and business as a strategy where a group is given a high degree of autonomy.  Since the group is unfettered by bureaucratic smothering and left to their own devices, an environment of creativity and productivity is allowed to flourish.

As anyone who has raised children knows, there is always a tradeoff between structure and discipline on one side and autonomy on the other.  A child has to be given the opportunity to play creatively on the playground without suffocating supervision but hopefully also without a string of concussions in order to do so.  The more rules and configuration handed down, generally the less independence and trust that are built up.  Yet rules and discipline also take the pressure off of an individual to make decisions that could be harmful or tough learning lessons.

When it comes to money, this tradeoff comes into play too.  With institutions, free markets do better without restrictions yet without some watchdog, some would and do cheat and game the system.  When it comes to individuals, the tradeoff is also important in that each person should learn how to handle money and make appropriate decisions.  On the other hand, the complexity of financial instruments and investments make it also important for some to have professional help.

The same tradeoff holds true for financial decisions.  It may seem that the more freedom of choice given that the better it would be.  Yet, we all know about the caveat of “analysis paralysis.”  Too much freedom makes it so difficult to decide that nothing ends up being done at all.  Also, the structure or context of our decisions is just as important as the choices themselves.  For example, given two choices, we may choose Choice A, just to pick one.  When given three choices, however, after seeing choice C, we may choose choice B which was rejected in the first case.  This also plays out in the results financially of too much or too little freedom.  Think of this as bad Capitalism or Bad Communism.  In the first, you have freedom to buy anything you want but can’t afford it and in the latter, you have the money but there is nothing out there to buy.

As an investment advisor, I have seen cases of too little autonomy as when one spouse makes all the financial decisions and then dies which leaves the other spouse not knowing how to handle their own affairs or even how to judge who could best help them with their situation.  Another common situation is from those who inherit money and were never given the opportunity to develop their own skills in this regard.  On the other side of the freedom-dependence fence, there are times when too much autonomy allows lottery winners, for example, to burn through their money faster than the spread of a virus at an airport.

Each of us deals with our own strengths and weaknesses by trying to know when we are our own worst enemy.  In what amounts to a game playing mode, students may impose false deadlines on themselves in order not to procrastinate.  In my own case, I know I have a propensity to lose such personal items as pens or sunglasses so I put my car keys with them when I set them down.  Since I can’t forget to leave without my car keys, this gives me a second chance to retrieve the item in case I forget to take it with me.  Of course, this assumes that I don’t see someone with sunglasses on and pen in pocket drive off with my car.  Richard Thaler in Nudge suggests a game where changing the default option to “enrolled” and then having to opt out, rather than the reverse, drastically increases retirement plan enrollments.

The operative word here for being effective in the autonomy against dependence game is satisfaction.  If the amount of choices you are given provide you with enough choice that you will be motivated to find the best and not opt out, you are in the sweet spot.  If you gain a sense of satisfaction from learning something new and expanding your capabilities then you are on the right track.  If you get little out of working with investments or planning a wedding than perhaps you should employ someone else to help you with it, providing the funds are available to pay for the service.   It’s time to wake up and smell the skunk.  When you resist change at the expense of personal growth, you may be denying yourself a chance to be satisfied.  If you do rise to the test, someday someone might ask you about some task or challenge that you took on and with a gleam in your eye you will be able to tell them you were part of your own personal Skunk Works.

 

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