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You Should Probably Let it Go

By May 16, 2023February 2nd, 2024One Wealth Perspectives

Over the holidays, my dad gave me a stack of wooden blocks wrapped in a bow. They looked like the pieces of wooden railroad tracks my brother and I would piece together as children. Some blocks had poems written on them. Others had small photos of me at various ages. Me on my first day of kindergarten. Me covered in chicken pox. Me dressed as a dalmatian for Halloween.

“They’re pieces of the floorboard,” he said. “It’s a puzzle. You have to match the poem with the photo.”

He had written little poems about the memories associated with the photos. As I started to read the first one, I choked on my own tears.

My parents were re-doing the home I had spent my early childhood in and selling the house. This was the place where my mother had made green eggs and ham on a Sunday morning. The place where my grandmother had held me under the tree in the front yard and smiled widely for a photo. That photo is my only memory of her.

In California, if you live in your property for two out of the last five years, it is considered your primary residence. When you sell your primary residence, the first $500,000 in capital gains is excluded from taxes for married couples (assuming all other criteria are met). This was going to be good for them. And money makes the world go round. But what about when pieces of a floorboard make your world stop? This is the meaning we imbue onto things.

Maybe Mom sat down with you as a kid and together you bought stocks of her company as an early lesson in finance. Or maybe you have a bunch of concentrated positions at Apple because you were an early employee and you can’t bear to sell them because look at how far it’s come.

Financial decisions about assets like these are personal, emotional and psychological. What is the financial benefit of what I’m about to buy or sell? Is it worth the emotional cost? It is not uncommon to see clients’ emotional attachments anchor them to financial decisions that are not always in their best interest, and even holding them back from future growth or opportunity. How do we know when it’s time to let it go?

David Steele has told me that one of the most important skills of being a financial advisor is the ability to point out when a client’s emotions are limiting or getting in the way of their financial best interests.

How do we move on? We want to hold on to the meaning we’re ascribing to this home, property, stock, years of work, while needing to let go of the thing itself. Once you are faced with that question of, “Can I let this thing go, and hold it elsewhere? Maybe in my heart, maybe in a photograph that’s burned into my brain, maybe in a weekly newsletter for One Wealth Advisors.,” that is when you are confronted with the impact this place, this person, this job had on you. The recognition itself is a powerful thing. Arguably more powerful than the thing you were holding onto.

Those pieces of my childhood floorboards are sitting on the bottom of my bookshelf. They’re dusty already. I’m not quite sure what to do with them. They are invaluable to me. But thankfully, they’re not worth very much.

The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor.
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