Conviction:  Building a Life, Career, and Investment Philosophy on Truth

 A Philosophy That Holds Up When Everything Falls Apart

Most people think conviction comes from having certainty. It doesn’t.

In fact, I’ve found that some of the most convicted people I’ve ever met were coincidentally some of the most uncertain! They’re willing to admit they don’t know what tomorrow brings. They are willing to admit they don’t know where the market will go tomorrow. They don’t pretend to have all the answers, yet they move forward with confidence and conviction anyways.

Humility is also one of the most important components of a healthy philosophy. After all, the more we know, the more we realize we don’t know! When truth is the final desitination, ego’s are put aside. Humility allows us to accept that we don’t control everything. It reminds us that certainty is often an illusion. It keeps us curious, teachable, and open to learning. I always found it ironic that it was the Noble Laureates in the finance industry who were the ones saying (with conviction) that they weren’t smart enough to beat the market. That irony always caught my eye, it made me pay attention.  Why are the smartest and most educated… the ones with least ego?

Conviction coupled with humility is a really attractive thing…especially to clients.

After spending my career working with financial advisors, watching investors navigate uncertainty, and recovering from my own accident and uncertainty…I’ve come to understand that conviction isn’t something we’re born with. It’s something we build. And like most things worth building, it starts with a foundation.  And whether its living correctly or investing correctly, that foundation begins with our philosophy.  We are all investors, and whether that’s in the stock market or our own lives, the same foundational rules apply.  To live or advise right, we need to have the right philosophy.

It is our philosophy that dictates our attitude, and it’s our attitude that drives our actions. Actions then create results, and those results then create our lifestyle.  It’s all additive…and it all begins with our philosophy. 

And what I find most interesting is that most people spend their lives focusing on the last two pieces (results and lifestyle), while ignoring the first three. They want better results. They want a better lifestyle.  But they rarely stop to examine the philosophy that’s creating everything else.  People almost always look everywhere else before they think to look in the mirror. It’s just easier that way.

The truth is that these five pieces build upon one another. Each step supports the next, but it always begins with philosophy.

Let’s take a look.

Piece One: Philosophy

Everything begins with philosophy.

Philosophy is simply how we interpret reality. It’s the collection of beliefs we hold about life, people, relationships, success, failure, money, and ourselves. These things are formulated from our education, our experiences, who we hang out with, etc. Philosophy is our hardware that drives our software, its dictates how we interpret life. And one thing I have learned is that how we see the world will often dicate how we recieve the world.

The same event can happen to two different people and produce completely different outcomes because each person interprets the event through a different philosophy. Their software is running off different programming.

One person experiences adversity and becomes bitter. Another experiences the same adversity and becomes stronger. Or, one investor sees a market decline and believes the world is ending, while the other just see’s it as opportunity. They see it as just the other side of return – risk. It’s what they signed up for.

The event wasn’t different.  The philosophy was.

As advisors, our philosophy determines how we guide clients through uncertainty. And as human beings, it determines how we navigate life’s challenges. We can’t have the right life with the wrong philosophy. The stronger our philosophy, the less dependent we become on circumstances, and that’s paramount for happy living and good advising.

Piece Two: Attitude

Attitude is how our beliefs show up. It’s interpretation demonstrated by our philosophy.

Two people can face the same circumstances and experience completely different emotions because they are telling themselves different stories.

I’ve learned this lesson repeatedly throughout my life.

After losing my fingers and toes to frostbite, there were days when I could have easily focused on everything that had been taken from me (and I did some days!). But, there were also days where I chose to focus on what remained…and that gave me invincible hope. It made me unstoppable. It gave me grititude (grit and gratitude), the will and desire to always get back up. And the right attitude can do the same for you.

Same circumstances. Different attitude.

And in investing…attitude is everything! When markets decline, some people see danger. Others see opportunity. Some see evidence that their plan is broken, while others see evidence that their plan is just being tested.

When we believe uncertainty is normal, we stop fighting it. And instead…we work with it. Great advisors and great humans understand this. When we stop fighting reality, we can begin working with it instead.  This alone separates the real advisors from the facilitators…and the gritty from the victims.

Our attitude is a reflection of our philosophy.

If the lens you’re looking at life through needs cleaning, turn to your beliefs. Turn to your philosophy. The pursuit of truth and expanding one’s philosophy is the key to changing one’s attitude.

Piece Three: Activity

Nobody accidentally builds a strong marriage. Nobody accidentally becomes physically fit. And nobody accidentally builds a successful business.

These outcomes are created through consistent activity repeated over long periods of time. Activity is the result of how we interpret life, driven by our attitude… which is formulated by our philosophy. It’s easy to be a disciplined investor when markets are going up, it’s a different story when markets are going down. Having the right attitude is essential for being a great advisor… and a great human.

One of the greatest lessons I’ve learned from running is that extraordinary accomplishments are often the result of ordinary actions, repeated consistently. One more step. One more mile. One more effort. Over time those small actions compound into something remarkable. Life and investing is no different.

If we want to be extraordinary, the answer lies in the ordinary. It lies in the fundamental actions we take on a daily basis.   Extraordinary people just do the ordinary… extra well. 

Piece Four: Results

Most people become emotionally attached to results and then mistakenly focus on that. The problem there is that results don’t always tell the whole story, in advising and life.

Great decisions can and will produce poor outcomes at times, and bad decisions can produce great outcomes. Every advisor knows this. A well-designed portfolio can underperform for years. A speculative investment can appear brilliant for a season. It’s this very reason that active management in public markets still exists! To be great at investing, we can’t make long term decisions based off short term outcomes.

And the same is true in life.

If we judge every decision solely by the outcome, we can easily abandon good processes and embrace bad ones. Results are important, but they should be viewed as feedback, not identity. Their job is to teach us, not define us.

A great investor focuses on process and good decisions, not short term outcomes.

Piece Five: Lifestyle

Lifestyle is the final piece of the puzzle.

Ironically, it’s the piece most people focus on first.

They want more money, more freedom, more success, more recognition.

But lifestyle isn’t really about what we own. It’s about what our days feel like. It’s the quality of our relationships. The peace we experience. The purpose we feel. The people we love. The places we spend our time. It’s the ability to wake up in the morning excited about the life we’re living.

As advisors, we spend our careers helping clients pursue financial freedom. But if we’re not careful, we can forget that money is simply a tool. People don’t really want money. They want what they believe money will provide. Security. Freedom. Experiences. Contribution. Peace of mind. And the irony is… that many of these things become available long before the financial goals are actually achieved…if they have the right philosophy. A great advisor understands this concept.

The Backwards Approach

The biggest mistake people make is trying to change the puzzle backwards.

They focus on lifestyle before everything. Results before activity. Activity before attitude. And attitude before philosophy.

But lasting change works in the opposite direction. A strong philosophy creates a healthy attitude. A healthy attitude drives productive activity. And consistent activity produces good results, which then creates a meaningful lifestyle.

Whether we’re talking about investing, business, relationships, faith, or life itself, the sequence remains remarkably consistent. The formula applies to all good living.

Again, I’ve learned that conviction isn’t certainty. It’s not having all the answers…and its definitely not predicting the future.

Conviction is the willingness to move forward without certainty because you’ve built a philosophy strong enough to support you when life doesn’t go according to plan.

Build the right philosophy first…and then watch your lifestyle change.

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