What to do in times of misfortune

In 1964, a 22-year old Muhammad Ali (known then as Cassius Clay) shocked the world when he became the world heavyweight boxing champion by defeating Sonny Liston. Two years later, Ali made headlines again, but this time for his refusal to take part in compulsory military duty, mainly due to his religious beliefs and because he was strongly opposed to the Vietnam war. He was arrested, found guilty of draft evasion, and stripped of all his boxing titles.

For nearly four years, which is an incredibly long and crucial time for any athlete, Ali was not allowed to box, and he was only granted the opportunity to fight for his most prized title again in 1971. His four-year absence from boxing, however, took its toll on Ali, who lost by unanimous decision against Joe Frazier in what was dubbed the “Fight of the Century”. Many saw this as the end of Ali’s boxing career, but through sheer willpower, hard work and dedication, Ali won one of the most famous boxing matches titled “The Rumble in the Jungle” just over three years later, against one of the hardest punchers in the history of boxing, George Foreman.

Let’s fast forward two years and turn our attention to Formula 1 racing. After Niki Lauda won the world title in 1975, he was topping the leader board by the time the German Grand Prix arrived in the 1976 racing season. In the second lap, however, Lauda was involved in a brutal accident which saw his car going up in flames.

He was so severely burnt that his doctors gave him a very slim chance of survival. A priest was summoned to administer his last rites, something that is only done for a person shortly before death. But no different to Ali, through incredible determination, fighting spirit and hard work, Lauda managed to get back into his Formula 1 motorcar six weeks later. He lost that season by one point, but managed to win his third world title again in 1984.

Finally, we turn the clock forward to the last decade. Tiger Woods made headlines for various reasons following his victory in the 2008 US Golf Open, few of which were good. By 2014, his back was so severely injured that his chances of playing golf again became less and less likely as the days passed. But following several operations, through his strong will and sheer dedication, Woods managed to win the 2019 US Open, 11 years after he last won the title, in one of the best comebacks of all times in golfing history.

Three different athletes in three different sports with one remarkable characteristic in common: Their ability to use misfortune to write their final chapters, not used as an excuse for failure, but as motivation to reach amazing success.

I’m sure many of you will agree with me that almost every person on earth is currently suffering to some degree. Whether it’s a business that is struggling or has come to a complete standstill due to the lockdown, or possibly your health suffering due to Covid-19, or your financial, retirement and investment planning that is taking more hits than George Foreman in “The Rumble in the Jungle”, we are all experiencing some form of misfortune at the moment.

But the question isn’t what is causing your misfortune, it is what you are going to do about it. Are you going to use this as an excuse for why things didn’t work out as planned, or are you going to learn from this and use it as motivation to improve your circumstances?

There is no reason why these three sports stars’ keys to success cannot be applied to the general public, and several quotes by these very sports stars have led me to believe that they left us with a set of golden rules.

Stay in control of that which you can control

Lauda once said, “I’ve been through a lot and I realise the future can’t be controlled. I’m not worried. You can always learn to overcome difficulties.” The moment we realise that life is full of surprises, we can start to plan for it. Plan so that we don’t end up in ruins when such a surprise is negative, and plan for the day that the same surprise might rear its ugly head again.

This may come in the form of an emergency fund, enough insurance, a well-diversified portfolio, a fuller wine cabinet or even a jumping rope for some exercise. Whatever the case may be, we are now IN this situation, so what will you do to stay positive?

Ali said, “It isn’t the mountains ahead to climb that wear you out, it’s the pebble in your shoe.” While there will be several interpretations, I believe that the challenge, however big or small, will remain. Focusing on what you can control is a start, but it isn’t always enough. Split your big challenge into smaller, more manageable challenges. Keep the pebbles out of your shoes, take one step at a time and I assure you, you will conquer that mountain.

Misfortune brings new opportunities

Woods said it best when he said, “The greatest thing about tomorrow is, I will be better than I am today…There is no such thing as a setback. The lessons I learn today I will apply tomorrow, and I will be better.” If you allow yourself to cover your eyes in misery, there’s a good chance that you will be blind to the opportunities that present themselves during times of misfortune.

If you made mistakes, now is the time to fix them. Laude said, “From success, you learn absolutely nothing. From failure and setbacks, conclusions can be drawn.”

Let’s use the last four big corrections, where the JSE dropped by 30{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} or more as an example. If you sold out of the market at the point where it lost 30{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} of its value and vowed never to invest in the stock market again, in the 12 months following each of those four corrections, you would have missed out on an average recovery of 28.3{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} on your investment. The market’s general trend is upwards, therefore, the investor that created an opportunity from their misfortune, possibly could have had new money to invest.

Important work lies ahead. You cannot change the past.

If the coronavirus taught us anything, it’s counting the days, but Ali said that this is exactly what we shouldn’t be doing. His words, “Don’t count the days. Make the days count,” tell me that we should be using this time to plan and even implement those plans.

Make no mistake, the road ahead won’t necessarily be easy. There will almost certainly be days on which you will want to give up. But Woods gave us some inspiration when he said, “Days when you just don’t have it, you don’t pack it in, you give it everything you’ve got. You grind it out.”

Be led by your masterplan, not your emotions

How many times have you allowed your emotions to lead you to make bad decisions? Whether its business-related or related to financial planning, short-term adjustments can be made, but your personal long-term master plan should always form the foundation of your decision-making process.

Any other adjustments are based on emotions and this makes them incredibly dangerous. Woods addressed this issue when he said, “I think the guys who are really controlling their emotions…are going to win.”

Always keep the bigger picture in mind, because as Woods also said, “I have a big-picture outlook, I am willing to fall, and I understand it’s OK to fall, but I am going to get back up, I may take a step back, but in the end, I am going to take a giant leap forward.”

While we may find ourselves in unexplored territory right now, I have NO doubt that we as South Africans will get through this.

This article was written exclusively for finweek’s 17 April newsletter. You can subscribe to the newsletter here: bit.ly/finweeknews