RPF0492-Hammers_and_Tools
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00:00:15.380 | Today I'd like to invite you to join me for a brief thought experiment and
00:00:20.160 | metaphor. Here's the question. If I ask you to make a list of all the
00:00:27.300 | different types of hammers that you can think of, how many hammers can you put on
00:00:34.320 | that list? You're welcome if you're driving to take a moment and hit pause
00:00:39.400 | and think about this, or if you are in front of a piece of paper, I welcome you
00:00:43.580 | to take a moment and jot a few names down. I'll wait. Now the number of
00:00:52.200 | hammers that you've put on your list will vary greatly depending on your job.
00:00:59.200 | And the types of hammers that you've put on your list will vary greatly
00:01:09.800 | depending on your occupation. My guess is if your job has nothing to do with
00:01:18.720 | construction or with using a hammer on a daily basis, you probably struggled to
00:01:24.720 | know the name of even a single kind of hammer. And you just said, "Well, a hammer,
00:01:27.840 | the kind that I bang nails in the wall with." But you might not know the
00:01:31.440 | distinctions of that hammer and might not know what the type of hammer that you
00:01:34.360 | have in the drawer at home is actually called. I noticed a zero headline article
00:01:40.680 | a couple days ago called – here was the headline, "Home Depot Panics Over
00:01:45.840 | Millennials Forced to Host Tutorials on Using Tape Measures and Hammering Nails."
00:01:50.440 | It was interesting just to demonstrate the lack of proficiency with basic DIY
00:01:56.240 | and home construction tasks that many young men and women have. Very different
00:02:01.520 | perhaps than past generations. So if you are one of a young person who doesn't
00:02:07.240 | have a job related to swinging a hammer, you probably struggled to come up with
00:02:11.440 | the name of the hammer you're picturing in your head. But if I gave you some time
00:02:15.440 | and you did this experiment, you could probably at least come up with something
00:02:17.800 | like a sledgehammer, right? There's two types of hammers. Or perhaps some of the
00:02:24.200 | hammers that have funny names, maybe you thought of something like a ball-peen
00:02:28.000 | hammer or a rubber mallet. These are things that many of us have seen and
00:02:33.200 | many of us have used. Now if you have a job or occupation that's not basic
00:02:38.320 | carpentry but does involve a hammer, you might have thought of some of the types
00:02:42.800 | of hammers that are unique to your business. For example, there's a lineman's
00:02:47.120 | hammer that's used to drive in big screws and bolts for those who are working on
00:02:52.600 | utility poles. Or if you were interested in jewelry, you would think of something
00:02:58.200 | called a chasing hammer, a very small hammer that's used to design and shape
00:03:03.520 | metal jewelry. Or perhaps in welding, you would think of a welder's hammer, which
00:03:09.000 | is a funny-looking hammer that has a spring for a handle so that it helps to
00:03:13.880 | make the metal hammer more comfortable to use and also so that the heat doesn't
00:03:18.720 | build up. Or perhaps you thought of an electrician's hammer or a drywall hammer
00:03:22.760 | which has a small little axe blade on the back that's used for breaking
00:03:28.760 | pieces of drywall board and a smooth head on the actual head of the
00:03:34.680 | hammer so that you can set in drywall nails without actually breaking the
00:03:39.440 | paper. And there are many, many, many varieties beyond that. Many occupations
00:03:43.640 | have uniquely designed hammers that are useful in that occupation. Or if your
00:03:51.240 | occupation is one that is very focused on the use of a hammer and it's not just
00:03:56.200 | peripheral, you could talk to me for quite a while about the different
00:04:00.640 | designs of hammers. For example, in carpentry, you'll find hammers,
00:04:07.720 | you'll find a trim hammer, you'll find a framing hammer, you'll have various sizes
00:04:12.480 | of sledgehammers, and there are different ways that these are all adjusted. The
00:04:16.240 | face of a hammer in some cases is smooth, which is useful for certain types of
00:04:21.600 | nailing, but then oftentimes a framing hammer will have a face that is
00:04:25.760 | checkered, which is useful in different contexts but not appropriate for
00:04:31.000 | finishing. Or the claw might be curved or straight. A straight claw is more useful
00:04:35.800 | for ripping function, but a curved claw is more useful for removing nails. The
00:04:40.520 | handles are made of different materials. You might have a handle that's made of
00:04:44.360 | metal, and of course there'd be different kinds. Maybe it's titanium. Or you might
00:04:48.840 | have a handle that's made of wood, and a wood one is more comfortable to use,
00:04:52.840 | passes less vibration through, but it's not quite as durable and it doesn't give
00:04:57.240 | you quite the same blow that perhaps a metal handle would would give you. Or
00:05:01.600 | even something like a sledgehammer. There would be, of course, different sizes of
00:05:04.520 | sledgehammers. You could have an 8-pound sledge or 12-pound sledge or a
00:05:08.440 | 20-pound sledge, and their handle length will vary and the handle construction
00:05:12.720 | will vary. What's my point in this discussion of hammers? Each of these
00:05:19.920 | hammers has the same basic function, the application of force to a concentrated
00:05:27.000 | area. That's what a hammer basically does. And if we put out every single one of
00:05:33.520 | these kinds of hammers on a table, you would identify each of them as a hammer.
00:05:39.080 | But they're all in a family. Now these hammers have different applications and
00:05:44.840 | thus some will be used far more than others. A heavy sledgehammer, a 14-pound
00:05:51.440 | sledgehammer, a 20-pound sledgehammer, is very rarely, for a carpenter, gonna be
00:05:57.400 | pulled out of the truck. That's really only there to drive a big heavy stake in
00:06:02.560 | the ground for a carpenter. Whereas a framing hammer or just a standard
00:06:09.040 | curved claw hammer will be on that carpenters tool belt each and every day,
00:06:12.880 | and he'll be using it constantly. Financial tools and financial products
00:06:19.120 | are no different than hammers. They are merely tools that can be used to
00:06:27.440 | accomplish certain objectives. And there's a wide variety among these types
00:06:34.280 | of tools. Some financial tools are very closely related. For example, if something
00:06:40.840 | is called life insurance, you can bet that it'll pay a death benefit when
00:06:46.640 | somebody dies. But the actual design of a life insurance policy, who's insured, who
00:06:54.360 | owns it, how many people are insured, who the beneficiaries are, the actual
00:06:59.680 | fundamental structure of the policy, the terms and conditions under which it pays
00:07:03.600 | out a death benefit, how long it lasts, whether or not it accumulates a cash
00:07:08.480 | value and under what terms those cash value accumulates, these are all features
00:07:16.520 | which are applicable in certain situations and are not applicable in
00:07:20.960 | others. The key is to look at the features and compare them to the
00:07:28.120 | benefits that you're trying to achieve. There are some financial tools that are
00:07:35.320 | broadly applicable. A 20-year level term life insurance policy is, in the tool
00:07:43.080 | belt of a competent insurance advisor and financial planner, a broadly useful
00:07:49.200 | tool. Think of it like a claw hammer. You can do a lot of good work with a claw
00:07:56.400 | hammer, and you can do a lot of good work with a 20-year level term life insurance
00:08:02.080 | policy. It's a useful tool. A well-managed, professionally run mutual
00:08:08.520 | fund is a useful tool. It has certain characteristics, certain features, and
00:08:15.200 | it's broadly useful in the tool belt of a financial advisor. But these are not
00:08:22.560 | the only tools, and they're not the only tools that you need. It wouldn't be
00:08:28.000 | uncommon for a carpenter to have a dozen hammers. That wouldn't be
00:08:32.640 | uncommon. And they may use two or three of them constantly. They have their
00:08:38.160 | favorite wooden-handled hammer when they are pounding a lot of nails and they
00:08:43.080 | just need a nice curved claw for useful, just general work. They might have a very
00:08:50.400 | light hammer for when their hands get tired, and then they have their big
00:08:53.200 | framing hammer. And those three hammers account for, say, 80% of the use. But
00:08:57.960 | the 16-pound sledge still needs to be in the truck. The tack hammer is useful when
00:09:04.560 | doing a little bit of final trim work, and the nail gun is used every day, as is
00:09:09.240 | the power hammer when installing flooring. These all have their place, and
00:09:15.040 | that's how you should view financial products. They have their place. Financial
00:09:21.840 | products are not, in and of themselves, good or bad any more than a ball-peen
00:09:27.160 | hammer is a bad hammer. Financial products are good or bad based upon the
00:09:33.840 | appropriateness of their fit to a specific circumstance. If you're closing
00:09:39.720 | up a rivet doing some metalworking, a lightweight ball-peen hammer is exactly
00:09:43.240 | what you want. But if you bring that out on demo day and try to knock out a 2x4
00:09:50.560 | stud in a wall as part of a demolition project with it, you will find your work
00:09:59.200 | non-progressing. For that work, you need the sledge and the framing hammer on
00:10:04.720 | your tool belt. So what can you, as a non-financial professional, do? Well, first
00:10:12.280 | of all, trust your gut. You know what a hammer looks like. You know what a life
00:10:17.480 | insurance policy is. And you know when you use these things. So trust your gut.
00:10:24.920 | Trust the people that have given you advice. When somebody gives you advice,
00:10:28.760 | there's probably something to it. But also be open to talking with those who are
00:10:33.320 | experts in their area. Be open to talking with those who can share with you why
00:10:40.120 | you might choose one type of handle on your hammer versus another and why the
00:10:43.960 | curve of the claw makes a difference. Don't reject something out of hand just
00:10:50.480 | because you're not familiar with it. But don't accept it forthwith
00:10:57.000 | simply because somebody has presented it to you. Ask as many good questions as you
00:11:03.360 | can. Get advice from as many experienced people as you can. What you'll find is
00:11:10.800 | there are some levels of personal preference. You might be talking to two
00:11:15.440 | grizzled carpentry veterans and looking at their hammers and recognize that they
00:11:21.160 | have slightly different hammers that they choose to wear on their tool belt
00:11:24.360 | every day. One prefers one that's heavier. One prefers one that's lighter. But
00:11:30.240 | there's probably going to understand one another. Just because two people would
00:11:34.920 | choose two different things doesn't make one right or one wrong. Sometimes there's
00:11:40.440 | a personal preference. On the other hand, sometimes there is a clear gap between
00:11:47.160 | the application and the tool. You can use a round rock to drive a nail into a
00:11:54.080 | piece of wood if that's all you've got. But we invented hammers for a reason. If
00:12:01.360 | somebody's trying to sell you a round rock as an ideal tool for you to use
00:12:06.120 | every day, run. This show is part of the Radical Life Media network of podcasts
00:12:14.720 | and resources. Find out more at RadicalLifeMedia.com. Struggling with your
00:12:21.360 | electric bill? Get an energy assist from SDG&E and safe. You may qualify for an 18%
00:12:27.720 | discount. Visit SDG.com/FERA to find out more.