Ep #096: Balancing ROI and ROL: Ensuring a Fulfilling Life After Business Exit

Investing in Life: Beyond Financial ROI

Welcome back to another episode of Business Exit Success. I'm your host, Tom Poltersdorf, and today we’re diving into a really important topic for business owners who are looking to exit within the next five years. This episode is about understanding the importance of investing in your life and making time to do things outside your business. Some of you may call this work-life balance, while others may not believe in work-life balance. But after almost 100 episodes focused on helping business owners successfully step away from their businesses, I can tell you this: having a life plan and a strategy for how you are going to spend your time outside and separate from the business is vital, especially for those exiting within the next five years.

Understanding ROI vs. ROL

First, let's understand ROI versus ROL. That's Return on Investment versus Return on Life.

The Obsession with ROI

You’re so busy investing in stocks that you might be forgetting to invest in life. You meticulously track every dollar’s return, wanting to ensure your money is being put to good use. It’s only natural that ROI, or Return on Investment, is your North Star. But here’s the issue: you try to track ROI on dollars meant for Return on Life (ROL).

My Personal Journey

Let me share a bit of my journey. There was a time when I was obsessed with investing in the stock market. Every extra dollar I had went towards it. I spent my free time looking for an edge in a little-known investment, trying to make it big. I made some good investments, but I also made some bad ones. The problem was I made no investments in LIFE. This led to burnout. I knew from then on something had to change.

What I Did

Delegating Stock Investments

I delegated my stock investments to a portfolio manager. Even though I’m a financial planner, I’m not a portfolio manager. Yes, we help our clients invest in stocks and ETFs, but we aren’t the ones reviewing the charts every single day. Having this off my plate has given me solid returns in my life and less stress.

Factoring Travel into Cash Flow

I factor cash flow into my travel every year. We take 4+ trips every single year. These aren’t purely costs; they are investments in my life and my family. Not only that, but travel and getting away expands my mind and brings me fresh ideas for the business. The key is that I have a spend number that I stick to.

The Lesson: ROI vs. ROL

So what’s the lesson here? ROI is important, but ROL, or Return on Life, can be life-changing. Financial success should enable you to live a fuller, more meaningful life.

Can You Quantify These Experiences?

Can you really quantify the return on experiences like:

Going on a safari with your family?
Spending the entire day on the beach with your kids?
Watching my son meet Optimus Prime for the first time or my daughter meeting Princess Poppy at Universal Studios?
Watching a fireworks show on the Jersey Shore beach for the 4th of July?

I don’t know if we can actually quantify these, but what I do know is they make me happy and fulfilled, and I wouldn’t trade them for the world. So do what makes YOU happy. Not just what increases your investment returns and makes you more money.

This Isn’t Just Financial Planning; This Is Life Planning

Remember, financial success is about enabling you to live the life you truly want. Through my experiences interviewing business owner entrepreneurs who have gone through an exit, I’ve found that spending time planning for this exact topic will dramatically help you transition out of your business successfully while also feeling fulfilled.

Spend time answering these questions:

Who will you be after an exit?

How will you spend your time?

How will you spend your energy?

How will you spend your money?

Getting to the root of these questions will put you on the right path.

If you are a business owner looking to plan your exit and want to ensure you’re also investing in your life, Get Your Free Readiness Assessment and learn more about how we can potentially help.

Remember, it’s not just about the money; it’s about living a fulfilling life. Be well, everybody, and we’ll catch you next week.