In this episode, we discuss ways to recover from setbacks faster in life by having financial, social, and human capital as your buffer.
Full Transcript
Hi Everyone, welcome to the You’re Daily Cup of Joe Podcast, with your host Joe Bautista. In this podcast, my goal is to give you quick lessons on how to grow yourself physically, mentally, emotionally, and spiritually so you can have better careers, better relationships, and better personal finances.
I’m also the author of the book “More You Know, More You Grow: How to Get Better Every Day”. In this book, I wrote down over 30 tips to help you grow in those four cornerstones. I’m also the founder of Grow With Joe, where I combine self-development coaching and financial planning for Latino Professionals.
In today’s episode, we’re are going to talk about how to recover from downfalls faster. We are all going to have setbacks and downfalls in our life and the best thing we can figure out what to do is how to recover from the setback or downfall as fast a possible.
I saw the best way to recover from downfalls and setbacks is to have a buffer to absorb some of the shocks and to have a buffer means having human capital, financial capital, and social capital.
I went through a divorce two years ago and if it wasn’t for me working on myself physically, mentally, emotionally, and spiritually, I wouldn’t have bounced back as fast as I did.
What really helped me was that I was studying the stoic philosophy and in the stoic philosophy they talk about things you can control and things you can’t control and that you have love fate that comes your way because it was supposed to happen.
When my ex-wife asked for a divorce, I was devastated for about a week but then I started thinking about my future and how I could recover. I just told myself, this is what it is and this what I can do to become a better person in the future. I read some books about relationships and I read the Nelson Mandela biography and that book helped me out because Mandela’s first wife left him because she couldn’t handle him being a lawyer who wanted to end the apartheid in South Africa. What if Mandela listened to his wife and stopped focusing on trying to end the apartheid, where would South Africa be now?
That book gave me the emotional and mental strength to keep going. This is why I write in a journal what I learned from my reading, I also write what I am grateful for, what is the uncomfortable thing that I’m going to do for the day, and how am I feeling for the day. This helps me have self-awareness and helps me recover from downfalls faster. I’m building up my human capital up that I can use when times get tough.
You also need to have financial capital. If your car breaks down, then you need to have money to fix it and by having an emergency fund available, you can pay off that expense with ease. If you get into a car accident, then you want to make sure you have insurance to pay for that expense. If you need help getting financial capital, start working on your human capital so you can get a job that pays a meaningful wage.
You also need to have social capital. When I told my friend that I was getting a divorce, he immediately said that I could move in with him and I appreciate him forever for that. So you want to make sure you have relationships that can help you out when times get tough and you should do the same when your friends need help out as well.
Like I said in a previous podcast, self-sufficiency is the road to poverty and we need to have people to help us out when times get tough. I’m also super grateful for my parents who have helped me out when times get tough as well.
I wish I could pay back my parents for what they provided me in life but I’ll do it one day.
So by having human, social, and financial capital built up, you create a buffer that can absorb the shock of a downfall. You’re going to fall but you’re not going to hit rock bottom. Since you’re not going to hit rock bottom, you can recover faster.
In investing, a goal is to maximize your downside protection because if you lose 50% of your portfolio, you don’t need a 50% to get back where you started, you need a 100% return to get back where you started. So you have to do more work to get back where you started. So the recovery is always going to take longer than the growth. Since this is the case, we should do things now that are going to minimize our downfalls and that is going to come from working ourselves.
Another great place to start is to read Amy Morin’s book “13 things mentally strong people don’t do.” This is a great book that describes everything you do when times get tough like don’t waste time feeling sorry for yourself, don’t give away your power, don’t focus on things you can’t control, don’t worry about pleasing everyone, and much more lessons that will help you get through the tough times. Your mind is going to determine what path you take with you receive that setback. Are you going to roll with the punches or are you just going to lie down and take the punches without getting away from the situation?
Life is going to be tough at times and we just need to work on ourselves and build up our capital to handle those tough times. I know something in the future is going to set me back, and I just need to be prepared for it. I should expect it since on average every 90 days, I’m going to receive some type of setback. I got sick in Aug with tonsillitis and I was down for a week. I even had to go to the emergency room to get pus drained from my neck. I was miserable for two weeks but I’m better now. I’m back on my grind but I made sure to take my rest to make sure that I made a full recovery. Since I work for myself, I was able to take the time off from work so I could really focus on my recovery. I think this is super important because not enough people take the time for a full recovery and it will just harm them down the road. I strive for control over my life because when I want to do something, I want to do something and that will only come from having capital.
That’s it for today’s episode, to summarize it, to recover the fastest way possible from a downfall, what you need to do is build up your human, social, and financial capital when you’re in the growth phase in your life because there will come a time where you will have a setback and is that setback going to be for five minutes or is it going to take you a year to recover. Being in the bust cycle is not very fun and if you can minimize those downsides, you will live a good life and one with a lot of growth.
To get a free copy of my book “More You Know, More You Grow: How to get better every day” just go to my website growwithjoe.me/book and just pay for shipping and handling.
I have a quiz on my website that grades your inner circle, so if you want to find out if your inner circle is an A, B, C, D, or F, you can take that quiz at growwithjoe.me/quiz
I’m also trying to do a feedback Friday episode, so if you have a question that you would like to have my answer on the air, just e-mail me at [email protected]
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Thanks for joining me today and remember if you go with Joe, you can grow with Joe, cause Joe knows Dough.
*Music outro
