It's a Wonderful Life (if You Plan)

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There are so many great traditions in the holiday season, but one of our favorites here at Cedar Point Capital Partners is sitting down for a screening of the 1946 holiday classic, “It’s a Wonderful Life.”

Wonderful Life_HERO.jpgIf you haven’t seen it, the film tells the story of small-town banker George Bailey (Jimmy Stewart), who has lived a life of sacrifice for others but watched his own life and dreams pass him by.

He struggles to keep his family’s building and loan business solvent and out of the hands of greedy businessowner Mr. Potter. He also faces his own existential crisis after thousands of dollars from the B&L supposedly go missing.

We meet Bailey on Christmas Eve, on the precipice of suicide over his own perceived failings. Just then, a guardian angel named Clarence arrives to save him, showing him just how impactful he has been on his tiny town of Bedford Falls.

There are some who see the movie as bleak due to the many misfortunes Bailey must endure and his suicidal turn, but we cherish “It’s a Wonderful Life” because it’s really about valuing the most important things in life—things like family, community and generosity. It’s also a timeless tale about the importance of investing with an eye to the long-term.

Investing in What Really Matters

On first watch, “It’s a Wonderful Life” isn’t really about saving or investing. Much of the movie revolves around Bailey’s resignation to the responsibilities that chain him to Bedford Falls, and the struggles to keep his family’s business alive amid the financial turbulence of the 1920s.

What’s most striking in our eyes, however, is Bailey’s altruistic investments in his life and community despite the hardships. Early on, he gives his tuition savings to his brother Harry, with hopes that he’ll attend college and run the business after graduation. Later, while leaving for his honeymoon with his wife, he comes upon a run on his family’s B&L. Bailey uses the $2,000 they had saved for the trip to instead make depositors whole, avoiding a buyout by Mr. Potter valued at cents on the dollar.

While we’re not advocating for using your honeymoon funds for anything but a honeymoon, it’s Bailey’s willingness to make hard choices and think long-term that resonates most for us.

Bailey could have kept that tuition money and let his brother fend for himself, as many would have been forced to do back then. He could have kept driving past the bank run and left for Europe with his new bride, leaving it to co-owner Uncle Billy to sort out. But what would he have come home to? What would his family’s future look like? What about Bedford Falls as a whole?

When Clarence arrives to show Bailey what Bedford would have been like without his influence, the picture is stark. The town, now called “Pottersville,” is filled with disreputable businesses, and the B&L is long gone, leaving residents to pay exorbitant rents in one of Potter’s many tenements. Life is sad in every way, and it’s clear that Bailey’s many sacrifices—financial and otherwise—had a positive effect over the long-term.

It’s a topic our own David Ernst talks about regularly: It takes courage to think beyond yourself and invest in things that aren’t immediately fun or pleasurable, especially when there is an easier way out. But Bailey did, and you can, too.

As we’ve written in so many blogs, the key today is a comprehensive financial plan that empowers you to respond to hard financial decisions with freedom and grace, rather than worry or anxiety. That includes saving money in a disciplined way so you have a nest egg available to spend, but it also means outlining your vision for what’s most important to you, so you can prioritize those dollars when the time comes.

When you have the peace and stability of a great financial plan, you can focus on savoring what a wonderful life this really is. We can help with that. Give us a call, and let’s grow together in the year ahead. Until then, we wish you and your family the very best for the holidays.

The commentary on this blog reflects the personal opinions, viewpoints, and analyses of Cedar Point Capital Partners (CPCP) employees providing such comments and should not be regarded as a description of advisory services provided by CPCP or performance returns of any CPCP client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this blog constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Cedar Point Capital Partners manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.