Rain, Rain, Go Away, But Please Come Back Another Day

I’ve lived in the Dallas area since 2004. Since living here, I’ve learned there are some things that are pretty reliable about Dallas. First, in the summer: it’s hot and it’s dry. In the 11 previous summers that I’ve lived here, we’ve typically had water use restrictions because of drought conditions. Even though the municipalities are often the biggest offenders of watering restrictions (not uncommon to see median strips being watered with sprinklers that are spraying water directly into the road, during a rare rainshower). The rest of us rule following residents end up with dry, brownish lawns and seasonal flowers that don’t make it to July 1st.

Not this year though. This year we are getting more rain than we know what to do with. Through May 31st, we have had about 32” of rainfall, which is more that the whole year for any year since 2009. In my time living here, I’ve learned that you can never complain about getting rain, we always need it. This year its making life kind of hard with trying to keep a youth sports schedule intact. My 5 year old’s soccer team started an 8 game season in mid February that took 4 months to complete (and the league finally had to move the last 2 games to an indoor facility because of rain forecast on gameday). Now we’ve transitioned to baseball season and have already had a good amount of games cancelled. My 7 year old now has stretch of 5 days with 4 games because of rainouts being rescheduled. My grass and my landscaping look great though.

Recently, I’ve read a couple of articles in the local media about municipalities lifting watering restrictions because the lakes are all nearly full. My question is: Why lift the restriction? Why tell people they can water their lawns more? Point A-we don’t need to water more, mother nature is taking care of that for us. Point B-Let’s make hay while the sun doesn’t shine. July and August are right around the corner and we’re likely to see 100 degree days and dryness. Why waste the water on our lawns today, when we may need it in August.

The paralell here to personal finance is that everything runs in cycles. Big picture, the economy runs in cycles. Individual businesses have their cycles, which may or may not coincide with the national economy. Individually, most of us experience good times and bad times. During the good times it’s wise to make hay while the sun shines. To borrow from Game of Thrones, Winter is coming.

When we have good times, saving a little extra can go a long way toward funding our goals and can go a long way toward helping if and when things are not so great. The common mistake many will make is that assuming trends will carry on infinitely. This is true of the stock market, and true of our personal life. Things go up, things come down. Don’t over-celebrate the good times so that it will be easier to survive the tough times. In the last 6 years, the stock market has nearly tripled. I don’t expect it to triple every 6 years (it would be nice), rather I maintain more realistic expectations that we’ve gotten some excess returns over these years. Some of that was making up for the tough times in the couple of years that preceeded and some of the excess returns will be paid for with more modest returns in the future. So we make Hay and we don’t water the lawn while it’s raining.