Every time Halloween, or as the kids and marketing geniuses call it now, “Spooky Season,” rolls around, we all get a chance for cheap thrills and quick scares from all the festivities. It’s a fun time of year; I enjoy decorating the house, watching my kids trick or treat, and the inevitable regret of eating too many Reesee’s cups on the 31st, the joys of tradition. But, since the holiday is about celebrating and facing our fears, I thought I would take some time to discuss the common financial fears I hear from people at all times of the year.
For many people, confronting their financial fears is scarier than any witch, evil clown, or werewolf they could ever imagine. Facing your financial fear is facing your financial future; if you have nothing planned, the future can be a dark and scary place.
As a financial planner in Greater Boston, here are some of the top financial fears I see from people each year; also, some advice to help those suffering from these particular anxieties on how to overcome them.
Financial Fears – Are You Afraid of Receiving Bad News?
Denial and avoidance are powerful pathways some people can take regarding their financial situation. Some bury their financial fears so deep down that they deny they even exist. Some hear Suzy Orman in their heads, exclaiming, “You can’t afford it!” when considering any life expenditure. I equate this type of deep-rooted fear to a stubborn relative who just refuses to go to the dentist. These people know they should do it but remain so afraid of what bad news they might receive or what could go wrong that they’d rather live in denial and deal with the enduring pain.
Some of my clients, who were finally convinced that talking with a family financial planner would help them, were overjoyed at the relief they felt when confronting these long-term denials and fears because the answers to their problems were nowhere near as horrible as they had projected.
Believe me when I say this: being uninformed is always scarier and worse in the long run than being informed. Once the issues and opportunities are recognized, a plan can be developed to move forward. There will always be challenges, but having a plan can alleviate how much these challenges impact our lives.
Financial Fears – Are You Afraid of Moving on From a Trusted Resource?
A different type of fear I’ll encounter from clients, albeit less frequently, is an unwillingness to move on from their current advisor or consultancy, even if they feel the need to. When financial advisors and their clients see eye-to-eye and have a great relationship, they become more like family members and less like salesmen. It can be a tough breakup if the client doesn’t feel that bond.
People need financial partners who make them feel important and listened to rather than just a number on a spreadsheet or part of a financial planning factory. If the long-term advisor has made mistakes, is no longer familiar with circumstances, or seems less concerned, it can be hard to move on from them because, like a family heirloom, they’ve been passed down. But the transition can happen with a helping hand.
It’s okay to be honest and truthful. Have the hard conversations with your advisor if things are not progressing as you’d prefer. Like any relationship, it’s far worse to sit and stew in discontent than to communicate and confront the issues clearly. Any respectful advisor will be happy to correct the course and, if need be, move on if the relationship no longer makes the most sense.
Financial Fears – Are You Afraid You’ll Never Be able to Retire?
This fear may be the biggest boogyman facing American workers today, a fear of being unable to or not meeting the requirements for a comfortable retirement. I hear it all the time; almost everyone, regardless of tax bracket, has fears about the unknowns of retirement – it’s quite normal. But, what’s not recommended is to live in fear and take no action. According to a recent SurveyMonkey poll, 56% of Americans are afraid of not meeting the requirements to retire.
Instead of choosing to live in fear of retirement or sticking with a plan that gives you no confidence, speak with an advisor and develop a plan that gives you the confidence you can retire at the age you want. It’s remarkable what a few adjustments can do for retirement savings in the long run.
There’s No Fate But What We Make For Ourselves
There’s no predetermined fate for your retirement outcome, but what is definitive is this: if you stick your head in the sand forever, retirement will likely never come. If you’d like to talk with someone about your financial fear, but more importantly, your financial hopes, I’m the guy who would be happy to listen.
Enjoy the rest of your Spooky Season!
