Imagine you're on vacation in some exotic location. All of the sudden, someone approaches you and offers you a $10 goat. Not a $10 goat cheese. A $10 goat. The person says that she's in the middle of an emergency and that she really needs the cash and to get rid of it.
Against your intuition, you listen to the person and offer her $10 as a gift. She says that she'll only take your money if you take the goat, that she's not looking for charity.
So, again, against your intuition, you agree to buy the goat from her. It's actually a nice goat, you're no vet, but surely looks great (for $10).
Then it hits you.
You're in vacation. In the middle of nowhere. You have no idea where you can buy food for your goat. There's no way you can take it back home. Just the transport fees, vaccinations, etc will probably cost you hundreds of dollars. How are you going to explain the purchase to your spouse? Sure, it was $10. But, why did you say yes?
Then, it hits you again.
You have a goat in the middle of nowhere. Are they going to allow it in the hotel? What if the goat was stolen? Or sick? Or pregnant?! A lot of ideas go through your mind. All of them about why buying the goat was not necessarily a good idea.
"I told you so". Says your inner voice.
So you proceed to do the next logical thing: Selling the goat. It's getting late, the sun is going down now, and you see less and less people outside. You start offering it for $10. Nobody wants it. Then for $5. Until, finally, you're able to sell it for $1. And you're happy because you dodged that bullet (or goat).
Sure, you wasted all day. But now (happily) you're goat-free.
Goats are impulse decisions (often followed by remorse or even guilt). Sometimes, a goat could take the shape of an extra slice of cake after dinner. For others, goats can be more expensive, like annuities, cars or even second homes and they can derail even the most carefully designed financial plan.
There's nothing wrong with buying goats, as long as you love them and they bring you joy and not guilt or remorse.
As your financial advisor, I can even help you determine the impact of adding another "goat" to your life. And, if you already have some goats and don't know what to do about them or want to learn how to stop falling for them, I can help you too! Schedule your complimentary call here.