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The Four Seasons of Personal Finance

I am on vacation in Oregon right now, so summer is officially upon me.  I have  always wanted to write about the four seasons of personal finance.  I’ve seen a couple of seasons come and go in my life and I wanted to explain it to those who are just starting out.  Like the story of the ant and the grasshopper, anyone who ignores the changing seasons may wind up cold and hungry when the winter sets in.  Here is the secret to avoid it.

Change is the Only Constant

The Four Seasons

Image by Aunt Owwee

In order for financial planning to be effective, it must take life events and personal factors into account.  A 25 year old single parent isn’t going to be able to save money like a middle-aged DINKs couple.  But, it’s still every bit as important.

One of the saddest things I see are people who are unprepared for the future who wind up in financial trouble.  They may have worked hard their entire lives, only to wind up broke when they are older and can no longer work to generate income.  The worst part is that it’s completely avoidable with a little bit of planning and financial discipline.

Spring (Teens & 20s)

Spring is the season where everything is fresh and new.  Life is colorful and exciting.  Energy and optimism are in abundance.  Every door is open and opportunties are endless.  This is also the season of youth and inexperience.  Others know this and they take advantage with credit cards, overdraft and cell phone contracts.  Winter is still 40-50 years away, yet the new car and the bright lights of the city beckon today.

Spring is a time for balance.  It’s a time to heed the call of nature and enjoy the qualities of youth before they disappear.  Yet, it’s also the time to plot a mature course toward the future.  Choices made in the Spring can lead in directions that may be difficult to change later in life.  It’s a good time to go on an adventure or start a business.  It’s the time to take a shot at big dreams, while the downside is minimal.  This is a bad time for extremes.  It’s a bad time to engage in destructive behavior or develop addictive habits.

Summer (30s & 40s)

Summer is the season of the long hot day.  It is the season of buying houses and raising children.  The burden is heavy and the bills are endless.  The resources are limited and needs overwhelming.  Work becomes the focus, the solution and the consolation.  A person’s title becomes their identity.  Income is the key element which balances the books of life.  And, it becomes the prize.

Summer is a time to make hay while the sun is shining.  It’s a time to shore up the financial foundation and to pull ahead in life.  It’s a time when the choices made earlier start to produce a result.  It’s the time when the industrious are rewarded and slackers fall behind.  It’s the time to shed debt and accumulate assets.  It’s a bad time to squander resources or purchase liabilities.

Autumn (50s & 60s)

Autumn is the season of the harvest.  It’s the time when all of the hard work finally starts to pay off.  The kids are big; the bills are small; the house is finally paid off.  Saving money becomes much easier.  Yet, the compounded results are minimal.  Those who have experienced setbacks will struggle to catch up, while those who are fortunate pack their pantries.

Autumn is a time when winter becomes inescapable.  It’s a time of panic and anxiety for the unprepared and a time of happiness and pride for those who have been resourceful.  It’s a good time to become more conservative with investments and to avoid potential risks.  It’s a bad time to learn about money the hard way or to lose focus on the future.

Winter (Retirement)

Winter is the season of long nights and bitter cold.  It’s a time of tumultuous change.  The strong survive; the weak struggle; the old and sick are lost.  Resources become scarce for the ill prepared, while others live in warmth and comfort.  Although time is ticking away, daily freedom is in abundance.

Winter is a time for conservation and relaxation.  Life is precious and waste becomes a sin.  It’s a good time to do and see the things that have always been dreamed of.  It’s a good time to adopt a healthy lifestyle and keep a positive attitude.  It’s a time to show some love and impart some wisdom.  It’s a bad time to become concerned with all of life’s problems.

The Moral of the Story

The moral of the story is that people must save during the first three seasons of their lives, in order to survive the Winter.  Waiting until Summer or Autumn is a huge mistake.  Whether someone is 25, 35, 45 or even 55 years old, they need to invest in their future, before their paycheck disappears.

Never give your paycheck to others without keeping some for yourself.

“You must take personal responsibility. You cannot change the circumstances, the seasons, or the wind, but you can change yourself. That is something you have charge of.”

Jim Rohn – Motivational Speaker & Entrepreneur

Recommended Reading

Bruce Bucks – Steps Towards Living your Dreams
Millionaire Nurse Blog – Medical Bankruptcy: Are you at Risk
Squirrelers – Memorable Examples of Witnessing Generosity

This post was featured on the Carnival of Personal Finance over at Canadian Personal Finance Blog.  This week, my post was selected as the Editor’s Choice.  Check it out.

15 comments to The Four Seasons of Personal Finance

  • I love how you have broken down personal finance into seasons of life. It allows me to see which season I am in and prepare for which season is ahead. I look forward to the different stages of life and trying to prepare the best way I can for each of them. I know I will learn something new in each stage, but will do my best to continue striving onward.

  • Great concept, breaking up the lifetime of personal finance situations into seasons. I like this, it’s an interesting way of looking at the topic in a relatable way.

    Thanks for including my post in your recommended reading list. Much appreciated.

  • I love the analogy you use of the four seasons in relation to finances! This is very similarly related to a fable I just read my daughter called the Grasshoper and the Ants. Excellent!

    • Thanks Rachel,

      The Ant and the Grasshopper story was half of the inspiration for this post. The other half was the 4 Quarters of personal finance, which I believe I read in one of Kiyosaki’s books. Anyway, I mixed both of these ideas together into something that covered all of the bases on the subject.
      Bret recently posted..The Four Seasons of Personal FinanceMy Profile

  • Bret,

    Still in Spring, but nice article. When I was reading I was wondering if you were going to make the ‘Winter’ part depressing… but it did seem inspirational, haha. Good stuff.

    -Paul
    PKamp3 recently posted..More Schadenfreude!My Profile

    • Paul,

      Enjoy the Spring while it lasts. Good Times

      I sure hope the winter isn’t depressing. The intro about the sick and old was probably a little over the top. I am putting a lot of energy into preparing for retirement and I definitely plan to enjoy it. I was poor enough when I was young and I don’t intend to be poor when I get old.
      Bret recently posted..The Four Seasons of Personal FinanceMy Profile

  • It is really a very nice post.You well explained four seasons of personal finance and I like the way you write the post.I am on my spring season now and You said right that spring is the time of balance.
    waterpearls recently posted..DriveScrubber Review & CouponsMy Profile

    • Thanks a bunch WaterPearls.

      I enjoyed my spring to the fullest. I lived at the beach, went to college and partied it up quite a bit. I wish I had of done better in school, so I could have made more money. But, I had a lot of fun and still managed to save some money. Knowing what I do now, I am kind of glad I lived it up. Work is becoming a 50 year comittment.
      Bret recently posted..The Four Seasons of Personal FinanceMy Profile

  • Hey Bret, thanks for the link!

    I love the way you’ve outlined life and it’s personal finance corollaries. It should provide guidance to those who are behind, and reassurance to those on target.
    Dr Dean recently posted..Vacations Spoiled: Ten Vacation Miseries and How To Prevent ‘Em!My Profile

  • I’m in the Autumn of life–that feels funny to say. We have packed the pantry with enough financial reserves to live comfortably. We’re happy about that after being careful with our money. I wanted to share with you the 4 stages of retirement:
    The first decade: The Go-Go Years when you travel a lot
    2nd Decade: The Go Slow Years when you travel less and take easier trips
    3rd Decade: The No-Go Years when you’ll be staying home and the family comes to visit you
    The 4th Decade: During this time period you will take your final trip & will be Gone.
    Maggie@SquarePennies recently posted..Paula Deen’s Zucchini BreadMy Profile

    • Maggie,

      Thanks for stopping by.

      I only have three years of Summer left. To be honest, I’m looking forward to Autumn. I worked really, really hard during the Summer years and I won’t mind taking my foot off the throttle a little bit. Our kids are finally adults and now it’s going to be our time.

      My folks are still in the go-go years of their retirement and they are just starting to slow down. I am very happy that they are taking good care of themselves, so they can enjoy the rest of their time. We ate dinner with them tonight and my Mom looks years younger than she is.
      Bret recently posted..He who Dies with the Most Toys is DeadMy Profile

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