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What Thanksgiving can teach us about money management

By Richard Barrington

For the Deseret News

Published: Thursday, Nov. 28 2013 9:45 a.m. MST

Many of us in the financial community spend a great deal of time trying to impress on people the importance of saving for retirement. The harvest is a good analogy for retirement savings.

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Editor's note: This article originally ran on FiveCentNickel.com. It has been published here with permission.

Don’t worry — this article isn’t going to be as cynical as that title may sound. I don’t even think my sentiments are especially materialistic. However, I do think handling money the right way is one of the most important things one can do for one’s family, and thinking of it that way sets me down a path which leads to several Thanksgiving-related themes.

Here are some of the financial issues that seem to relate to Thanksgiving:

Celebrating the harvest.

Many of us in the financial community spend a great deal of time trying to impress on people the importance of saving for retirement. The harvest is a good analogy for retirement savings. For one thing, it doesn’t happen overnight. A farmer can’t just go out one day with no prior effort and harvest food for a Thanksgiving feast, much less enough to provide for a long winter. It takes a consistent, dedicated effort. It also takes careful planning. Knowing when to plant is like knowing when to start saving and how much to set aside. Knowing which crops to plant for your needs and the conditions you face is like asset allocation. Ultimately, a harvest feast like Thanksgiving isn’t enjoyed simply because it is a great meal — it is appreciated because it has been hard-earned.

Anticipating the joys of winter.

Winter can seem like a harsh time in northern parts of the country, but it helps to find things to like about it. Whether it’s winter sports or a warm fire, the beauty of the snow or simply not having to mow the lawn for a few months, there are upsides to the season. Of course, winter is a natural analogy to the later phases of one’s life, and I think it is similarly important to find things to enjoy about the prospect of retirement. Making retirement saving about building toward positive goals rather than just meeting an obligation can help you stay motivated.

Leaving the table at the right time.

Thanksgiving may be the ultimate food-oriented holiday, and the quality, quantity, and variety of the modern Thanksgiving feast can be literally staggering. It can be a fine line between thorough enjoyment and over-indulgence, and knowing where that line is can mean the difference between a satisfying snooze on the couch or a stomach ache afterward. Similarly, it’s important for investors to know when to participate and when to pull back from getting greedy. This comes to mind especially because the stock market ended October up some 23 percent so far in 2013. Now that many stock portfolios have been fattened up, Thanksgiving may be a good time to think about trimming them back a bit.

Remembering times past.

Thanksgiving is a time for telling old stories and reflecting on our personal and collective histories. Doing so can help us appreciate how far we’ve come. The financial analogy here is that the past is a great teacher for how to get better at handling money. Thinking about your past decisions and getting to know a little something about market history can help you make more informed financial moves in the future.

Seeing the limitations of material things.

Thanksgiving dinner is a good time to look around and realize that the most important parts of your life are the people seated around the table. Material things simply cannot compete with the joy of having loved ones around. Given the massive amount of debt American consumers have accumulated — $3 trillion and rising, and that doesn’t even include mortgages — it’s also important to remember that material things can come at the price of a crushing debt burden. Sometimes, the most luxurious life isn’t the most comfortable one.

Recognizing the importance of community.

Beyond the people around the Thanksgiving dinner table, there are larger communities of neighbors, countrymen, and humans that we belong to. Whatever gifts you are thankful for — your wealth, your personal abilities, etc. — Thanksgiving is a good time to think about how to share them with the larger community. At a time when the gap between the haves and the have-nots is becoming steadily wider, it’s important for the haves to think about digging a little deeper to reduce that gap.

Don’t get me wrong — it’s not like I’m obsessed with finance on Thanksgiving. The most important thing about the holiday is having a peaceful day with family, with the smell of turkey and stuffing in the air and the sound of football games in the background (though have you noticed, those Thanksgiving games are rarely any good — it’s usually as if one of the teams has had its big Thanksgiving meal right before game time). Anyway, home and family are the main things I value about Thanksgiving. It’s just that I will never get so complacent that I’ll forget to be thankful for having had the means to enjoy those things.

Richard Barrington is a personal finance expert for MoneyRates.com. He has earned the CFA designation and is a 20-year veteran of the financial industry.

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