One of my passions is the game of hoops, as in Basketball.. NCAA, NBA and FIBA. I love the way the game is played, the strategies involved both in offense and defense, which brings me up to this next post... DEFENSE.
My favorite NBA team is the San Antonio Spurs. I live in Los Angeles, and have done so for years, although I've lived on the east coast and the bay area for a short period of time, and people look at me weird that I'm not a Lakers or Clippers fan. Don't get me wrong, I like those teams as well, and a bold prediction I will make right now is that the Lakers will make the playoffs. Okay, maybe a bit optimistic, but never count Kobe out!
Now back to the Spurs. Ever since I've followed them, they have been a model of efficiency, from the David Robinson days, to the current roster. Each player knows their role. There are a few superstars, but the coach treats them as if they are 3rd string guys. In other words everyone is equal. Now where am I going with this? I thought you'd never ask.
Any die-hard Basketball fan must've absolutely loved this past year's finals. Well, maybe if you're a Heat fan you wouldn't have; but to watch those Spurs dismantle Miami; especially the last 2 games-- wow-- there's no other words to describe it. They had offensive firepower in Mills, Parker, Ginobili and Duncan; but the defense-- Khawi Leonard on LeBron James was a sight to behold. I'm an LBJ fan as well, but the way the defense worked on him and subsequently his Miami Heat, to ultimately subdue them-- man... it was a CLINIC.... and it started with defense.
Now this applies to financial matters as well. If you have high interest cc debt, and other consumer debt, it doesn't much matter that you have an excellent income. One could argue that if one had a high paying job, then spending like there's no tomorrow could be justified. But remember, if that income comes from a "job"; a high paying one.... there's no guarantee that it will be there tomorrow. In other words, if you're living paycheck to paycheck and have the bulk of your earnings spent on frivolous items, you are one misfortune/catastrophe away from financial ruin. Lebron James will beat you off the dribble and will see an opening to Ray Allen or Chris Bosh in the corner for that uncontested 3! Three points right there, and your 10 point lead has been trimmed to 7, then 4 then... gulp... tied game.... with a minute left on the clock... or in financial terms, you're 50 years old with only $10,000 to your name, and a mountain of consumer debt.
Now this is a dire situation. Lebron James is a skilled B-ball player, perhaps the best.. and he will try his damndest to score on your team; and he will succeed-- unless your team plays great defense.
Now instead, if you had no consumer debt, or very little of it.. then you can weather the financial storms should one arise. This is playing good defense. And... if every member of your team knows their roles... i.e. debt repayment, 401K contributions, and having a fully stocked emergency fund, then you will be an efficient machine; much like the San Antonio Spurs.
There was an analogy of this sort in the book "The Millionaire Next Door". I know it sounds kind of corny, but I think there are a lot of parallels from the Spurs gameplan, and being an efficient financial machine.
Therefore pay off the high interest debt, and build that emergency fund and strengthen your financial "defense".... and the LeBron James's of the world as imposing as he may seem, will find it hard to score on your basket.
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