Lessons From the School of Hard Knocks

Well in looking back at the lessons I've learned

and the mountains I've wanted to climb,

I just look at myself at find,

I've learned the hard way every time.

-Jim Croce

I told a friend that my McNay Consulting organization has started doing life coaching. She looked at me strangely and said, "You're fat."

My friend believed that only perfect people can be life coaches.

I'm trying to figure out what a perfect person looks like. Everyone I know has some kind of problems, even if they present a strong exterior.

I understand what a life coach can do. They help people visualize where they want to go and figure out how to get there.

Sounds simple but it is harder than people think.

A consultant and I were recently doing life coaching exercises to get me to ready for the New Year. It started slowly. Because my vision was not clear, my goals weren't clear and neither was my path.

Then we hit the million dollar question. Who are the five people you admire most? The five were all close friends and had similar attributes.

I wanted to be like them.

Once that was settled, the rest of my vision fell into gear.

After nearly 30 years of helping people with their money, I figured out long ago that financial issues were rarely about rates of return or asset allocation.

Money is usually about emotions.

Most of the time, people are using money to buy something that is missing in their lives.

It could be they are missing love, self-esteem or security. They could be using money to cure loneliness or as Jackson Browne once said, "to fill in the missing colors of their paint by number dreams."

Most of the time, money don't care what really ails them. The ailment remains but they wind up losing their money too.

If a person can figure out what they really want, money can be an important tool in making that wish a reality.

I wonder how coaches learn life's lessons. My best lessons have come from the school of hard knocks.

If I make a big mistake, I tend to learn from it.

As I noted in my book, Wealth Without Wall Street: A Main Street Guide to Making Money, I made some financial mistakes when my mother and sister suddenly died in 2006. Mistakes that a person with my financial education and background shouldn't make.

I was using money to deal with grief and personal upheaval. The same way that many people do.

I'm fortunate. I had the resources to pay for my mistake and the ability to keep on generating income.

A lot of people get money in one large chunk. If they lose it all, they don't have a chance to earn it again.

I wrote a book about lottery winners and how so many have lost their money. I've never heard of many of them winning the lottery twice.

Most of my clients have been widows, widowers and injury victims. They are whose lives changed in the split second that a drunk driver ran a red light or a truck driver fell asleep behind the wheel.

I frequent see people in settlement negotiations or meditations looking for revenge or some kind emotional satisfaction.

It doesn't work that way. I try to sit down with them early and explain a basic fact.

I tell them, "all the insurer can give you is money. They can't bring your loved one back to life. They can't allow you to throw away your wheelchair and walk. All they can do is write you a check."

"It your job to take the money and use it to create a normal life for you and your family."

People will sometimes get a substantial amount. Despite my warning, within five years, that money will usually be gone.

Keeping injured people, lottery winners and others who receive large sums from blowing their money has been my life's work.

I use a number of financial tools and common sense advice to keep people from making large mistakes. Some people listen. Some don't.

The people who don't listen often learn through the school of hard knocks.

A school where you might lose all your money before you graduate.

My job is to steer them away from making bad decisions but as the song says, many learn the hard way every time.