Article written by Phil Slade in the MoneyMag. August 28, 2020; using chess we can learn about financial blows and still moving forward towards our goals.
Ever since my son was little, we’ve loved playing chess together. Chess is a great game to learn how to win at life.
Look at the whole board and don’t let immediate threats blind you to other opportunities. Think four moves ahead, but be present in the actual game and change your plans based on your opponent’s moves.
Use failure as a way to learn to play better next time.
All are fundamental life lessons that we all need to be reminded of, and chess is a great way to practise these lessons.
LESSON TO BE LEARNED:
One of the greatest lessons of all is what to do when you lose your queen.
The queen is the most powerful piece on the chessboard, and to lose it usually means you are at a significant disadvantage.
When you lose your queen you often feel as if you’ve already lost the game.
You play more recklessly because you feel there’s nothing to lose and, sure enough, you quickly lose the game.
But a seasoned chess player knows that the game isn’t over until the king is in checkmate.
While losing the queen is a setback, you reassess the board, change your plans and continue to play.
The player who can reset and not react to the pain of losing the queen is the most formidable.
The way we instinctively react to loss, and try to avoid loss, is what behavioural scientists call loss aversion.
When your queen (think of your job, for instance) is under threat, you can often get distracted by avoiding the pain of loss rather than keeping an eye on the whole board.
Good players use this distraction technique by threatening the queen of their opponents, so they don’t see the actual threat somewhere else on the board.
When we do lose our queen we often throw in the towel and give up or play recklessly, ending up in a worse situation than when we started.
How It Relates To Personal Finances:
We see this behaviour in share trading all the time.
If your more profitable shares start to take a dive, you get distracted by this threat and stop playing the board.
As the feeling of loss increases, emotion takes over and you begin to trade recklessly to make up for losses. This rarely ends well.
And it’s not just limited to share trading; we also see this effect in our spending. Once we blow out our budget we tend to completely overspend and think, “I can get things back under control next pay day.”
Or in business, we often see leaders who have lost a lot on one project that doesn’t go well, then make deals and invest in riskier projects in order to make up for the pain of the initial loss.
When you lose your queen, whatever that might mean to you in real life, the trick is to learn to put emotion aside and respond according to what is right in front of you.
Put the pain of loss out of your mind and ask yourself what the best move is right now given the reality of the present context. Respond, don’t react.
This is the greatest lesson I could ever give my boys, and one I try to remind myself of every time life deals me a blow that I didn’t see coming.
When you lose your queen, don’t throw the game.
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