Competitive Maxims Applied to Personal Finance

As some of you know, I spent a year or two in my past playing competitive Magic: the Gathering (a card game with organized tournaments), earning enough winnings for the hobby to pay for itself. I was never able to compete at the highest levels, mostly due to time constraints from my career and my marriage (which seriously limited how much time I could devote to gaming).

winNear the end of that period in my life, I picked up a very interesting book by David Sirlin called Playing to Win. David was a competitive player of tournament-level Street Fighter (a video game) who went on to be involved in the production of several games, including Super Street Fighter II Turbo HD Remix. The book outlines psychological strategies that serve anyone well if they’re looking to compete seriously in any sort of gaming or sporting environment. If you’d like, you can read the book for free on Sirlin’s website.

So why would I mention such a book on The Simple Dollar?

A few days ago, I stumbled across this book again and sat down to read it, mostly as a nostalgic reminder of a certain period in my life. As I read through the pages, I began to realize that most of the ideas presented in the book actually apply very well towards successful personal finance.

Five Ideas That Really Intrigued Me

1. Some of the made-up rules you have in your head are holding you back.

Every single person lives by some set of rules that they’ve made up in their head. These rules tell us how to behave in certain situations, what products to buy, who to associate with, what to do on a boring Friday evening, and so on.

Most of the time, these rules are worthwhile guides. They can keep you out of dangerous areas, help you to make sensible choices about who to associate with, and so on.

However, sometimes these rules guide us in a poor fashion. They encourage us to buy things we shouldn’t. They encourage us to waste time on unimportant things (mostly due to a poor definition of “important”). They encourage us to spend too much time on our careers – or not enough time. They encourage us to spend too much time on our families – or not enough time.

Breaking through these “rules” by getting rid of the ones that don’t work is a powerful step towards personal finance success. Question every action that you take, because each action takes time and energy and (often) money and it takes those things away from other elements of your life. Work to break the routines that are out of line with what you truly want in life.

2. You don’t get ahead by doing splashy things to stand out.

You can have the best attention-getter in the world, but if there’s not something behind the curtain, an attention getter doesn’t matter. You can be the richest person in the room, the most well-dressed person in the room, the most attractive person in the room, or the most technology-laden person in the room, but in the end, it still all comes down to you.

In short, you can buy a little attention, but you can’t buy the respect of others. You have to earn it, and it’s not bought. It’s earned through who you are – your actions, your knowledge, your abilities, your friendship, and your reliability.

Buying stuff to impress others might work as an attention getter, but it won’t help you actually build friendships and relationships. On the other hand, focusing your energy on improving yourself will not only save you money, but it’ll help you build the right kind of reputation over the long run.

3. You’re rewarded by focusing only on the situation at hand.

Imagine you’re at the grocery store. You’re walking down the aisle, but your mind is elsewhere. You’re thinking about a friend or a family member, or about what you’re going to watch on television tonight. After wandering around a bit on cloud nine, you add an item to your cart.

Now, imagine you’re at the store, but you’re focused on finding the best bargain among the bread options. You study the items available, compare the prices, peek at your notes to see what the competitor’s sale price is, and find that indeed, this loaf meets your needs and is about a dollar cheaper than the other options. You add it to your cart.

Both experiences took about the same amount of time, but one ends with a great purchase in the cart, while the other most likely ends with something overpriced and not particularly matching the needs and values of the customer.

Focus on the moment. If you’re shopping, shop. If you’re driving, drive. If you’re working, work. If you’re reading, read. You’ll find that the task at hand goes much more smoothly – with much better results – when you bear down and focus just on the task at hand.

4. You constantly have an opportunity to cultivate valuable, positive relationships with people around you.

Every time you’re in a social situation – and that includes being online – you have opportunities to cultivate a positive relationship with people around you. The more positive relationships you’ve built, the more likely it is that something positive will echo back on you.

Be positive towards the people around you. Say positive things about others. Help other people when they need it. Volunteer for the tough jobs that no one else wants to do. Participate in groups.

You’ll build relationships. More relationships means a stronger community. Everyone in that community benefits. Those benefits are passed to everyone in the community, and since you’re a part of it, you benefit, too.

5. When observing others, things are often not what they seem.

The person in the expensive car with the expensive clothes and the expensive house is often so buried in debt that they’re scared to sleep at night. The man in the rusty car often has a wad of money in his bank account.

Remember that the appearance of someone often completely obscures the truth. People often try to cover up the truth underneath or present a truth that matches up with some false expectations in your head. It is never, ever a bad move to spend some time looking a little deeper.

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