• Home
  • Fraternities&Sororities
  • Entrepreneurship
  • WealthBuilding
  • Brotherhood
  • Sisterhood

Subscribe to Updates

Get the latest creative news from FooBar about art, design and business.

What's Hot

New Netflix features this Alpha Brother. #alphaphialpha #divinenine #Netflix #lionelrichie

The Legacy of Brotherhood at Southern Miss 🏛️

🥶🦍Alpha Patch Bundle or get ‘em individually #aphia #alphaphialpha #divinenine #nphc #fraternity

Facebook Twitter Instagram
  • About us
  • Contact us
  • Privacy Policy
Facebook Twitter Instagram Pinterest Vimeo
Divine 9
  • Home
  • Fraternities&Sororities
  • Entrepreneurship
  • WealthBuilding
  • Brotherhood
  • Sisterhood
Divine 9
You are at:Home » What is the Point of Money?
Wealth Building

What is the Point of Money?

adminBy adminMarch 20, 2025No Comments5 Mins Read
Facebook Twitter Pinterest Telegram LinkedIn Tumblr Email Reddit
Share
Facebook Twitter LinkedIn Pinterest WhatsApp Email


A reader asks:

Why would a financial advisor recommend a client buy a boat? Isn’t that irresponsible?

This question was in response to a segment from a recent episode of Ask the Compound. Someone made a substantial profit investing in Palantir shares and was asking what to do with the proceeds.

The question was investment-related: Should I let the money ride or invest it in something else? Just to cover all the bases, I wondered if those profits could be used for something else — maybe a vacation or the down payment on a home or boat or something outside of the markets.

Fred Schwed wrote the best finance book title of all time called Where Are the Customers’ Yachts. This story from the book is the origin of the title:

Sailing into the harbour at Newport, William R. Travers saw many beautiful yachts at anchor on the sunny water.

‘Whose boat is that?’ he asked.

‘It belongs to So-and-So, the great Wall Street broker.’

‘Whose yacht is that big one over there?’

‘It belongs to So-and-So, another great Wall Street broker.’

And whose is that big steam yacht almost as large as an ocean liner?’

‘It belongs to the greatest of all the Wall Street brokers and bankers, So-and-So.’

Travers looked at the different yachts, asked about them, and got always the same answer. At last with his usual stutter, he asked: ‘Where are the customers’s yachts?’

There were no customers’s yachts to be seen.

The idea, of course, is that Wall Street employees get rich, not the clients. Jason Zweig once told a joke that goes like this:

I put two children through Harvard by trading options. Unfortunately, they were my broker’s children.

Everyone in the finance industry isn’t looking to rip off their customers but you get the idea.

Interestingly enough, getting wealthy clients to spend their money is one of the biggest roles for a financial advisor today.

David Blanchett and Michael Finke recently published a research paper on retirement spending habits. Married households 65 and over spent just 2.1% of their savings in a given year on average. Investors are happy to use any income generated from their portfolio but are reluctant to spend down their principal balance. The median retiree is spending far below their capacity to spend based on their financial assets:

Transitioning from saving and investing to spending and consumption is a psychological hurdle that can be difficult to overcome in retirement.

When I joined Ritholtz Wealth Management, Kris Venne explained to me that one of his biggest jobs as a financial advisor centered around helping their clients enjoy the fruits of their labor — buy that vacation home, take that family trip, buy the convertible, buy a boat, etc.

I didn’t really believe him until I experienced it firsthand in client meetings. There are bigger problems in the world but so many discussions revolve around the worries of spending money in the face of all the uncertainties involved in retirement.

Our advisors create comprehensive financial plans with clients so they run the numbers when trying to make these dreams a reality. You can’t just spend with abandon and hope things work out. When the numbers work, we love seeing pictures of clients enjoying their wealth.

The point of money is to spend it.

The point of delayed gratification is eventual gratification in the future. It’s not irresponsible for a financial advisor to recommend their clients buy a boat if that’s one of their financial goals.

I’ve heard the joke that boat translates to Bust Out Another Thousand. It can be expensive to buy a boat, store it in the winter, buy gas and dock it in season. It’s not cheap.

We became a boat family a few years ago. It’s also a lovely way to build memories, hang out with friends and family, and spend time outside away from screens. It’s an investment in experiences.

I’m not saying every wealth management client needs a boat. It’s certainly not for everyone.

You have to define what’s important to you and spend money on those areas. For those with a psychological block on spending money, an objective third party can help give you permission to enjoy your wealth in the context of the financial planning process.

There are opportunity costs if you don’t invest enough for the future and opportunity costs if you don’t enjoy the present.

A good life is all about balance.

Sometimes that balance means spending money. The future is promised to no one and you can’t take it with you.

Blair duQuesnay joined me on Ask the Compound this week to discuss this question:

We also answered questions about when to change your asset allocation during a correction, why Wall Street is so bad at price targets, the economic impact of tariffs and taking out a 401k loan to fund a down payment.

Further Reading:
10 Great Lines From Where Are the Customers’ Yachts?



Source link

Share. Facebook Twitter Pinterest LinkedIn Reddit WhatsApp Telegram Email
Previous Article‘Every day I wake up in this darkness’: Past SU hazing victim calling for change
Next Article Delta Sigma Theta Sorority, Inc. Shuts Down the MEAC Basketball Tournament! 🔥🔺🐘
admin
  • Website

Related Posts

The Top 1% – A Wealth of Common Sense

June 20, 2025

Announcing a Mindful Partnership: Mindful Money and Monarch Money

June 20, 2025

Expected Returns in the Stock Market

June 19, 2025

Leave A Reply Cancel Reply

You must be logged in to post a comment.

Demo
Top Posts

New Netflix features this Alpha Brother. #alphaphialpha #divinenine #Netflix #lionelrichie

June 21, 2025

Balancing Life as a College Student

July 5, 2023

Why Are Sorority Values Important?

July 5, 2023

It’s Not Just Four Years- It’s a Lifetime

July 5, 2023
Don't Miss
Brotherhood December 26, 2024

FIRST TAKE | Stop saying Chiefs are a lucky team! – Shannon reacts to Mahomes dominate Texans 27-19

source

Wednesday, November 8th 2023

How to Beat the Senior Slump – Something Greek

Yesterday there was a NPHC picnic in Chicago…. #aka #1908 #sorority

Stay In Touch
  • Facebook
  • Twitter
  • Pinterest
  • Instagram
  • YouTube
  • Vimeo

Subscribe to Updates

Get the latest creative news from Chapter App about design, business and telecommunications.

Demo
About Us
About Us

Welcome to the Divine9 Blog, your ultimate destination for uncovering the transformative power of fraternities, sororities, wealth building, and entrepreneurship. Join us on this captivating journey as we explore the rich tapestry of experiences, wisdom, and knowledge that these four remarkable categories have to offer.

Facebook Twitter Pinterest YouTube WhatsApp
Our Picks

New Netflix features this Alpha Brother. #alphaphialpha #divinenine #Netflix #lionelrichie

The Legacy of Brotherhood at Southern Miss 🏛️

🥶🦍Alpha Patch Bundle or get ‘em individually #aphia #alphaphialpha #divinenine #nphc #fraternity

Most Popular

Weekend Reading | Saturday, June 18, 2022 — Mindful Money

January 9, 2024

Kamala Harris On “The Rickey Smiley Morning Show” Through The Years

July 25, 2024

UNCLE LUKE ACCUSES TARIQ FBA FUNDED BY YT UMAR VS STEVE HARVEY #umarjohnson #uncleluke #steveharvey

August 28, 2024
© 2025 Divine9.blog
  • About us
  • Contact us
  • Privacy Policy

Type above and press Enter to search. Press Esc to cancel.