One of the greatest joys of being free people living in a capitalistic economic system is that we are free to succeed beyond our wildest dreams. With such great opportunities comes the harsh reality that we can also fail. Is failure such a horrible thing, or does it make us better, stronger and more likely to succeed?

Failure to put effort into preparing for the future is the culmination of many decades of failure, not one single act or event. I believe the concern over these small levels of failure creates a paralysis of action, and that paralysis as a whole causes us to fail.  

I recently read Nassim Nicholas Taleb’s book “Antifragile: Things That Gain From Disorder,” in which he puts forth the idea that small, manageable failures create an antifragility in the whole. Our desire to never fail is our own worst enemy.  

“Provided we have the right type of rigor, we need randomness, mess, adventures, uncertainty, self-discovery, near-traumatic episodes, all those things that make life worth living, compared to the structured, fake, and ineffective life of an empty-suit CEO with a preset schedule and an alarm clock,” writes Taleb.

Is risk of failure a motivator? We all react differently to difficult stimuli; and boy, have I learned this the hard way. If a person understands the value of failure, one can use it. If one fears failure and will avoid it at all cost, failure is a very poor motivator. This is how we get victims and the “victim syndrome.”

Victims feel out of control and may believe that this has become their fate. On an issue-by-issue level, that could be the case, but not for the whole of one’s life goals. So to understand the value and the power of failure as a motivator, one must first understand and embrace the points made above. Small failures create antifragility to big-picture goals.

How do we see people adjust to failure in their financial lives? In 26 years, I’ve met my fair share of victims. To their last breath, their view on life was they “just got screwed.” I have no advice for that way of thinking. For most people (less the victims), the decision of when to retire is one of compromise and balance.  

Visualize a chart as an illustration to drive home my point. On the left-to-right axis is the “Pain of Work,” which represents the pain of going to work every day. Sometimes it is a physical pain, but most often it is work getting in the way of our lives.

On the other axis is contentment with our lifestyle. When those two lines intersect, that is the magic answer for you. Saying it another way, when your nest egg is large enough to support a lifestyle with which you are content, and work has no other rewards, then you have reached your critical mass and should retire. How do you know when you are there?  Retirement planning provides one part of the formula, helping you make an informed decision.

Do people adjust their lifestyle expectations? Yes, all the time. This is how most cope with not hitting their goal. (That’s making the assumption they had a defined goal in the first place and are not just reacting to life events.) 

We have safety nets in our society like Social Security and Medicare, but these are designed to be just that – a safety net, not a core plan. Most people who don’t prepare simply keep adjusting down their lifestyle requirements as they age.  

So as I conclude, I have a number of questions for you to ponder. Do you have a plan? Is fear a motivator or are you a victim? 

How will you compromise, if you need to?


Brian Hood, a certified financial planner, is a senior partner with Legacy Financial Group LLC, an Urbandale-based financial planning and education firm.