Convenience not always a virtue

By Byron Moore, posted February 20th, 2014

Question:  I just started a new job and the HR guy says I should put as much as I can into our 401K plan. He says I won't miss the money out of my paycheck, but I've got some debts I need to get paid off. Besides I really don't know anything about investing. I like the idea of getting it automatically done so I don't have to think about it. What do you think?

Answer: We love it when things are convenient.  

There's a new car wash place that has opened up in my town. They say I can just drive through, never get out of my car and have a clean ride in just four minutes. I think I'll give it a try. I mean, four minutes and never get out of the car - that's convenient. And if it's still dirty after I give it a try, I guess I'll go someplace else and get it done. No big deal.

But convenience has its limits.

If a new urology clinic opened up, advertising "four minute drive through prostate exams - you never even have to get out of your car!" I don't think I'd try that. Call me old fashioned, but convenience isn't always the only thing to consider.

Have you ever seen those late night TV commercials (not that I ever watch late night TV) where the over-excited host is selling a cooking device where you can just "set it and forget it," which presumably means you just throw the chicken in the pot and come back in a few hours and it's done. Didn't they used to call that a crock pot? No matter.

The value of convenience must be weighed against the risk of failure.

If I blow a few bucks on a car wash that doesn't work, or a bird that gets over cooked, life goes on.

On the other hand, messing up big, lifetime financial decisions like retirement saving, investment management or insurance protection are too important to make based on what's convenient.

But how are these critical issues pitched to the public? What we usually get are slogans selling convenience, like "Fifteen minutes could save you fifteen percent."

I often see retirement accounts, IRAs and variable annuities that someone got into several years ago...and nothing has changed. They have the exact set of investments they had five or ten years ago. Now, if that is the result of a plan, fine.

But more times than not, it is simply the result of negligence. It wasn't ever "convenient" to review their investments, so they ignored them. Now they just mourn them.

Don't do something because it is convenient. Do it because it's smart. Because you (or someone helping you) has thought about it and made a wise decision.

Too often "set it and forget it" turns into "forget it and regret it."

Convenience can be overrated. 

Byron R. Moore, CFP® is Managing Director / Planning Group of Argent Advisors, Inc. Email him at bmoore@argentmoney.com. Write to him at 500 East Reynolds Drive, Ruston, LA 71270 or call him at (318) 251-5858. The opinions of any single advisor do not necessarily reflect the opinions of Argent Advisors, Inc.  No forecasts can be guaranteed.  Argent Advisors, Inc. does not offer tax, insurance or legal advice.  The information contained in this column should not be construed as a substitute for personalized investment, tax, insurance or legal advice.