“I would work alone”

Last week, I was back in the junior high schools, visiting the two classes that I taught as part of the Junior Achievement program. It was the last class of the course, and I went in with the idea of finding out what they learned from their fantasy stock trading. The first thing that struck me was how few of them really took an interest in this project. It’s likely that, as with most people, they simply don’t see it as relevant or useful to them. The same was often true when I worked as a financial advisor. It seems likely that people hire an advisor specifically because they don’t want to take responsibility for their investment choices, even though their employer (or former employer) has left them with that responsibility.

But what was even more striking was when I asked what they would do differently, if they could do it over. One boy timidly responded: “I would work alone.” He didn’t want to insult his teammates (they worked in groups of four), but he would have preferred to work alone rather than with his team. The reason was that they didn’t have any strategies for working together and when disagreements arose, they weren’t able to negotiate the difficulties. That reminded me of the fact that many couples fight about money and the idea that money is one of the leading causes of divorce. If I teach the course again, I’ll offer the following solutions to help the students work better together in their teams.

Separate the responsibility. The students began with $100,000 of fantasy money. A team could grant each member $25,000 to invest or trade as they please. The result would be the cumulative result of each player. This would have the benefit of allowing each member complete freedom. It has the drawback that each person experiences the consequences of everyone’s decisions. This could work for a couple, especially if they’re willing to retire (or travel, or spend) separately if that’s the result of their financial decisions.

Make democratic decisions. It’s possible to vote on every decision and to respect the will of the majority. This has the benefit of subjecting decisions to additional scrutiny. The expectation would be that if a member has to pitch the idea in order to sell the team on it, the best ideas will usually be acted on. But in a team of four, or a marriage of two, this isn’t mathematically possible. Another possibility is to make unanimous decisions. If a decisions appears good and both or all members ¬†agree, it is implemented; if not, there is no deal. This has the same benefit as the democratic approach, but the drawback is the possibility that one person could block the team, which could result in total inaction.

Authorize a single decision-maker. This seems to be the approach used in most companies. One person is responsible for the results of a team and that person makes the final decision. They usually try to get input from team members, and they often try to keep everyone happy. But to keep the project moving forward, they will sometimes make assignments and executive decisions. The benefit is that this approach avoids inaction, but it has the drawback of potentially sidelining the contributions of individuals. Hiring a financial advisor might fit with this approach.

A hybrid approach. In order for a strategy to work, it needs to fit with a team’s personality, preferences and situation. A couple may choose to have some separate accounts and some joint accounts, as well as working with an advisor, but agreeing never to proceed with changes unless they both agree.

Have you adopted any of these approaches in your family? Is there another approach that works for you? Would you prefer to “work alone”?


2 thoughts on ““I would work alone””

  1. The approaches we have used are:

    I talk endlessly about things and then see what sinks in for my wife. When we talk about investing a specific way she asks questions and helps to bring my optimism back into check to make sure that it is a rational decision and not just jumping to conclusions or investing with my emotions.

    For most of it, we have adopted a few of the situations above. With me being an accountant it comes down to me coming up with the ideas, and then trying to make things work and come up with something to do and then do my best to explain it in normal english so that it can be understood.

    Overall I prefer to work alone, but I get sanity checks along the way to make sure that what I think seems to make sense.

  2. First off, that reminds me of doing a similar project in Junior High. Thank god it was an individual assignment. My stocks lost money, but I don’t think doing it as a group would have been any better. On top of the loss there’d be the whole group work thing. I never did well with that.
    So, is it surprising that in real life my husband and I are almost completely in the first category? – all separate works for us. We retain control, though do share all information about what happens with our money, discuss some decisions, but mostly make our own choices.
    It does make sense in our particular jobs for him to make and save more money now and to retire earlier, and me to work longer, but work less hours now. I’d hate to have to tie every decision together. Why should he have to work longer just because I chose to make less money now? So, yes, we both work better alone. And try to get actual jobs with lots of alone time as well, incidentally, though not surprisingly.

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