The Benefits Of Nonconformity

The immense benefits of choosing a different path.

Whenever possible I try to understand a topic, concept or viewpoint from the other side of the argument or put differently I try to challenge certain assumptions when a lot of people hold them. While I try to do this, I also concede I could be better at it. One recent example for me relates to diet. I have come to believe, after a lot of ongoing reading, that everything we've been taught about cholesterol, fatty diets, carbohydrates and on and on was wrong. I'm not trying to convince anyone of anything but this is something I have explored, found a lot of content and drawn my own conclusion.

Nassim Taleb does a lot of this, most recently debunking the concept of IQ testing, having produced a multi-week Tweet storm that is mostly beyond me quite frankly and while I don't how important, accurate or relied upon IQ tests have ever been (I've never taken one) I like the larger idea of taking a look at widely held belief and trying to deconstruct it.

More Taleb, James Altucher had a blog post that included the following image;

I take the heroin reference a proxy for any addictive substance but the other two are more confrontational. I've been very clear on my beliefs about carbs but the viewpoint is a source for much disagreement and I take his idea behind monthly salaries to be about complacency and the lack of variability that can come when you don't take risks (variability in all things appears to be very important to him and when you delve in, it makes sense).

Long time readers will know I am fond of saying to take bits of process from various sources to create your own process. I think of confronting common beliefs as being a type of contrarianism. To the extent I take in bits of process from various sources some of what I do in client portfolios is contrarian in terms of the nuance of how I take defensive action and maybe a couple of other things too.

A little more importantly I think is coming at clients' portfolio needs more holistically in terms of getting the other aspects of your financial life in place and even some broader aspects of life in place beyond financial matters.

Here's a list of 10 financial resolutions from Forbes and while I don't necessarily believe in resolutions, most of these are good habits especially if you can look at them beyond their literal meanings.

Three of them are about getting rid of stuff (decluttering) and buying less stuff. You can find plenty of content that explains why we derive less satisfaction from consumerism and the accumulation of crap but have you ever purged on some scale? It usually feels pretty good. Among other things it is a metaphor for a simpler life. This appeals to you or it doesn't, it does to me.

The list also talks about setting up a monthly recurring donation to a charity. I wouldn't say don't do that but your time is more valuable than your donation. Also, donating your time promotes social, even if merely task oriented, engagement which is crucial on multiple levels.

I would include things like living in less house than you can afford and driving your car for much, much longer than the five year loan cycle (car's paid off, time for a new one!) as being nonconformist compared to how most people do things. There are external forces that work against us on this point (social pressures) and internal forces (aspiring to bigger, better, newer) but overcoming these pressures, while non-conformist, makes every other aspect of life easier.

The logical extension of figuring these things out for yourself is that you can be comfortable with a simpler portfolio and place a lesser burden on your portfolio when the time comes to starting withdrawing from it.

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