Trump Is All About His B.S.

The year of the Trump Chicken

Man, I still can’t believe Donald Trump is our President. Almost everything that comes out of his mouth is pure B.S.  However, there was one thing that I heard Trump say that actually made sense to me. I have to go way back for this. He said it during his second debate with Hillary. In response to Hillary confronting Trump about why he didn’t release his tax returns (because he was afraid to show the American public that he hadn’t paid federal income taxes in years), Trump said that his income didn’t matter because he was all about his B.S.–his Balance Sheet, that is. This is one thing upon which I agree with Trump. You gotta focus on your balance sheet rather than solely on your income statement.

Balance sheet? Income statement? Aren’t those things only for companies? Yes, companies use them to manage their businesses. But we, as individuals, would benefit if we used these business tools to manage our personal finances. I described this to my son with a little sports analogy.

Income Statement = Score of the Game

Think of your annual income statement as the score of the game. If you score more points (your income) than your opponent (your expenses), then you win the game. You might be up one quarter and down another. But if you have the most points at the end of the fourth quarter, you win that particular game. So, if you generate more revenue than expenses, your business is profitable. If you spend more than you earn, your business has a net loss. The old adage of “live within your means” comes to mind here.

Balance Sheet = Your Overall Record

Winning one game is good, but what is your overall record? Are you like the record-setting 2015-16 Golden State Warriors 73-9? Or are you this year’s Brooklyn Nets with the league’ worst record of 20-62. And it’s not just for the season. It’s your overall lifetime record. It’s how many winning seasons you’ve had, how many championships you’ve brought home, how many hall-of-famers have blessed your rosters, etc. Are you like Mike (6 rings) and Kobe (5 rings) or are you still in search of a winning season?

That’s where the Balance Sheet comes to play. You stack up all of your wins in the Asset column (e.g., bank accounts, brokerage accounts, 401Ks, investment properties, etc.) and compare them to all of your losses in the Liabilities column (e.g., mortgage, student loans, credit card balances, and other debts). If you have a significantly greater amount of assets than your liabilities, then you have a winning franchise. The difference between your assets and liabilities is also called your net worth.

Conclusion

Natalie and Debbie (photographer mom not pictured) at the Woman’s March.

I disagree with so many things that Trump has to say, but the importance of your balance sheet is not one of them. If you focus only on your current income and expenses, you put yourself into a just getting by mentality. Instead, you have to build on your wins and focus on growing your assets.

In other words, you may have won a few games, but what do you have to show for it? That’s what the balance sheet helps answer.

Note: Title Was Kid-Approved

When I told my son Matthew the title of this post, he said we should rename it because people might think that I meant B.S. to be the swear word. I told him that was the point. It’s a play on words that might get more people to read it. He thought about it, and then cracked a smile. “Good idea, Dad.”

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