When I was a child, it was important that ideas and tasks were simple. That's because I had not developed the knowledge and skills needed for the complex elements. As my skills and knowledge grew, I was able to handle more complex ideas and tasks. Throughout my twenties, thirties and forties, I would use complex processes to maximize the benefit for me. While the processes took extra effort and thinking, the additional benefits made the processes worthwhile to do.
In my fifties, I am thinking that simplicity may be a better choice going forward. While I'm still able to manage complexity, it is taking more effort and time than before. So the benefit of having more complexity are not as great as when I was younger.
Investing in our retirement accounts is one area that I will test if simplicity is a better choice. Over the next few months, I will create an ETF portfolio for part of our retirement savings and compare the results to returns of market indices. I hope to find out that a simple diversified ETF portfolio will yield comparable result to a complex portfolio of selected stocks.
For more on Crossing Generations, check back every Thursday for a new segment.
This is not financial advice. Please consult a professional advisor.
Copyright © 2013 Achievement Catalyst, LLC
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