The Sound of Music: Financial Lessons From Your Favorite Hits

With the 61st GRAMMY Awards just around the corner, music is on the mind!

You expect financial advice from an advisor, and even sometimes from your friends and family (whether you want it or not). The last place you expect to hear it is singing along to your favorite song—but that doesn’t mean it’s not there.  Consider these lyrical gems that can help you remember some of life’s most crucial financial lessons.

“We can do something with ’em/ We’ll make something out of ’em/ Make some money out of ’em at least.” – The White Stripes, “Rag and Bone”

The White Stripes put a melody to the old adage “one man’s trash is another man’s treasure” in this song, showing you that you may have wealth right under your nose, if you could just realize it. Whether it’s maximizing contributions to your retirement plan, taking more strategic tax deductions, or simply donating unused goods or available funds to charity, there may be small, everyday ways to make better use of your resources. It’s important to regularly evaluate your financial plan to ensure you’re not missing anything; gaining a fresh perspective can help you find treasure in things that you may have overlooked as “rag and bone.”

“It’s like the more money we come across/ The more problems we see.” – The Notorious B.I.G. ft. Mase and Puff Daddy, “Mo’ Money, Mo’ Problems”

If Biggie was referring to estate planning, he was probably right in saying that more money leads to more problems—especially if you don’t have an adequate plan in place. If you do have a large amount of wealth, it may be necessary to consider complex estate planning techniques such as trusts or charitable donations that help you avoid estate and gift taxes. By sheltering your wealth, you can achieve a more successful wealth transfer and avoid the problems of legal entanglements after your death. No matter how much you have to pass on, however, it’s important to have basic estate planning documents such as a will and power of attorney and to discuss your postmortem plans with your loved ones.

“And can I sail through the changing ocean tides/ Can I handle the seasons of my life?” – Fleetwood Mac, “Landslide”

Stevie Nicks and Co. raise some good questions in this iconic song that address the fears many of us have about life changes. Sailing through the many stages of your life will involve navigating uncharted financial waters, including career changes, marriage, children, investing and retirement. While smooth sailing will mean different things to different people, planning ahead will undoubtedly make each of these transitions easier. Contributing to retirement funds from an early age, adjusting your investment risk as you grow older, building up an emergency fund and maintaining adequate insurance coverage can help you maneuver through each season of your life with ease; failing to do these things, on the other hand, could lead to a financial landslide.

“Every breath you take/ Every move you make/ Every bond your break/ Every step you take/ I’ll be watching you.” – The Police, “Every Breath You Take”

Sting has said that he was unsettled by how many people think of this as a love song, when it really tells the story of an obsessive, stalker-esque ex-lover. While it might seem obvious that watching literally every breath that someone takes could be termed “obsessive,” many people unfortunately enter into this same relationship with the stock market. Just like a failed relationship, it can cause a bit of an obsession if you let it. Constantly checking your stocks’ performance can drive you crazy and cause you to make unnecessary trades. It can also make you lose focus of your long-term investment goals, which are crucial to your retirement. If you’re feeling the need to constantly make same-day trades or find that your happiness is dependent on the market that day, it may be time to give your portfolio some breathing room.

“Wait ’til I get my money right/ Then you can’t tell me nothing, right?” – Kanye West, “Can’t Tell Me Nothing”

“Yeezy” expresses a view that many people share, which is that the wealthy must automatically have good financial sense—how else would they be wealthy, right? While this might be true for people like Warren Buffett, who used his financial prowess to get where he is today, many celebrities are lousy financial role models. Consider Michael Jackson, who died with almost $323 million in debt, largely due to his extravagant Neverland ranch. Kanye himself spent anywhere from an estimated $3 to $8 million on Kim’s engagement ring, and additional hundreds of thousands on the extravagant proposal, which included renting out the San Francisco Giants’ stadium and hiring a full symphony. Contrary to Kanye’s lyrics, everyone can likely learn something about finance, and upping your financial savvy can help you find ways to save (and spend) smarter.

“You can’t start a fire/ You can’t start a fire without a spark.” – Bruce Springsteen, “Dancing in the Dark”

As Springsteen points out, sometimes all it takes is a small spark to start a large fire—but you need the spark first. The same can be said of your savings—if you start saving just a little at a young age, that initial investment can provide a spark that compound interest can turn into a much bigger number. For example, if you invest $10,000 at age 28, compounding your investments quarterly and earning an average rate of 7 percent, you could have almost $30,000 in just 15 years. And that type of exponential leap in funds is something that could impress even The Boss himself.

“You better check yo self before you wreck yo self.” – Ice Cube, “Check Yo Self”

When it comes to credit scores, Ice Cube’s lyrics may just serve as the best reminder out there. The importance of checking your own credit reports cannot be overstated; no one but you is going to care more about their accuracy. If you don’t “check yourself” regularly, false information could quickly lead to your credit score being wrecked. And don’t assume that your report is error-free—the FTC found that one in four consumers had identified errors on their credit reports that might affect their credit scores.

Securities and investment advisory services are offered solely through registered representatives and investment advisor representatives of Ameritas Investment Corp. (AIC), a registered Broker/Dealer, Member FINRA/SIPC and a registered investment advisor. AIC is not affiliated with Summit Group of Virginia LLP. Additional products and services may be available through Summit Group of Virginia LLP that are not offered through AIC. Representatives of AIC do not provide tax or legal advice. Please consult your tax advisor or attorney regarding your situation.

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