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Commentary & Insights

Insight, Financial Planning

Money Physics

27 April 2021

By: Steven Weintraub

It has been 334 years since Sir Isaac Newton published his masterwork1 addressing the concepts of energy and force. His theories would lay the foundation for the study of Physics.

We believe his ideas also apply to personal financial planning.


Newton’s first law of motion suggests that an object in motion will remain in motion unless an external force interrupts it; AKA Inertia. WCF initiates a financial analysis by mapping out your journey, targeting your goals and objectives and measuring speed and direction, based purely on inertia. If we hold the following elements in a “steady state,” will you be happy with the destination?

  • Working to a specific age.

  • Adding to savings each year, either in a qualified retirement plan and/or with after-tax dollars.

  • Investment posture/portfolio structure.

  • Standard of living upon reaching retirement.

Internet-available tools provide a simplistic view of this dynamic. However, they are incapable of addressing both the detail and nuance with calculated income taxes, social security options, the dynamic nature of real estate investments, potential inheritances, housing buydowns, charitable giving strategies, Opportunity Zone investments, etc. This is akin to making flight plans but ignoring the weather.

Going through the Inertia exercise is tantamount to getting a comprehensive medical physical exam limited to just one of two results: provide you with objective professional affirmation of your good shape, or, if unsatisfied with the trajectory, create more time for gradual, measured adjustments, rather than having to yank on the steering wheel to avoid a cliff.


There are various interpretations of “making it” financially. We tend to baseline with conservative assumptions for investment returns, inflation, and longevity. If one needs to course-correct, the second of Newton’s laws come into play: Force equals mass times acceleration. Simply stated, improving financial security can be achieved through mass – more savings, more work, or more sacrifice of lifestyle upon retirement – or acceleration – implementing the changes sooner.

Push and Pull

Newton’s final law is that for every action, there is an equal and opposite reaction. This reasoning helps us to accept the innate potential trade-off involving financial decisions. Individuals generally don’t want to work indefinitely or give up their current lifestyle by saving every dollar earned, or accept too much portfolio volatility, or give up their lofty plans in retirement. However, sometimes one or more of these ideals must be compromised for the math to support authentic financial security. A detailed analysis allows one to see and measure the costs and benefits of decisions. Is it worth it to you personally to work one extra year to maintain a conservative portfolio? Is it worthwhile to work an additional year in exchange for extending that annual vacation and upgrading your airline seat selection?

It is not our job to tell anyone which deeply personal values they should pursue, but it is our responsibility to shine the light on the reality of Money Physics at work. We do that to empower you to attach personal values knowledgeably to your hard-earned money. Somehow, we think Sir Isaac Newton would also approve.

1 Philosophiæ Naturalis Principia Mathematica, 1687