20 Ideas That Will Take the Fear Out of Financial Planning
20 thoughts to carve a path through the darkness and conquer your money fears.
Posted Jul 25, 2019
The other day, a new client came in to talk. It turned out we were both fans of Game of Thrones, so we started chatting about the finale that ran in May, just in time for us to spend the summer wondering what it all adds up to. No spoilers for those who haven’t caught up yet—except that as we were talking, my client recalled Melisandre the Red Woman and how several seasons back she said, “The night is dark and full of terrors.”
“That’s kind of how I feel about my money life,” my client said.
“It doesn’t have to be that way,” I assured him. “Let’s explore that and see if we can help it be less terrifying.”
After the meeting, I thought about the conversation and about how many people see something dark and foreboding when they look at their personal finances. Yet even Melisandre said of the terrors in the night, “The fire burns them all away.” What’s true in a medieval fantasy is even truer in the real world: Enlightenment can help make your financial life less stressful and overwhelming, and way less terrifying.
So I sat down and spelled out my favorite words of money wisdom. Use these 20 thoughts to carve a path through the darkness and conquer your money fears:
- Money is a tool. Period. It isn’t a symbol of anything, unless you place that belief onto it.
- It doesn’t matter what anyone else earns or spends. Whether it’s your brother, aunt, next-door neighbor, or person in the next office, what they have isn’t a reflection of what you have.
- True wealth is the ability to live aligned with your values, not someone else’s. Comparing yourself to anyone is needless mind-bending agony. Why would you do that to yourself?
- Financial security means being able to withstand unexpected setbacks. You’ll feel a lot more secure if you have an emergency fund.
- If money can fix it, it’s not a real problem. Think about health issues that all the money on earth cannot solve. If all you need is money, consider yourself lucky.
- Happiness is knowing the difference between needs and wants and living it.
- I don’t care how warm and fuzzy the TV commercials from financial institutions are; the companies that pay for them have their best interests at heart, not yours.
- The job of advertising (all advertising) is to convince you to buy what they’re selling, whether you need it or not.
- Your “number” – that’s the amount of money that will be sufficient to satisfy your goals – is uniquely yours.
- Your money history creates your beliefs, behaviors, and habits. Some histories work in your favor and others will knock you into money misery. Connect the dots between your past experience and your current behaviors.
- Give yourself a money motto that supports your values. For example: “Save for a rainy day,” or “Money empowers you to help others.” Write your motto down and read it five times a day until it becomes instinctive.
- Make sure you and your partner are on the same money page. If you’re not, seek some help to get there.
- Your financial life does not have to be complicated. Keep it simple and cover all the main issues: risk management, liquidity, cash flow management, estate planning documents, and a rational investment plan that you understand.
- Avoid the hot stock, the hot IPO, and the hot fund manager – unless you are prepared to lose.
- Most people understand less about money and financial issues than you do, even if you don’t think that’s true.
- Your biases control your decisions. Just because you believe something is true doesn’t make it so. Separate hard fact from opinion.
- Before you sign onto working with any financial advisor, read the fine print, ask all the questions, and get a clear picture of any conflicts of interest and how the advisor is paid. Demand complete transparency.
- Financial success is not a set-it-and-forget-it process. It shouldn’t consume your life, but you will benefit from a system to help you monitor your progress and any issues that arise.
- Ask yourself what threatens your financial stability. Identify the risks and work like hell to mitigate those risks wherever possible.
- Your money life doesn’t have to be a source of pain or discomfort, and certainly not terrors. Past mistakes are in the past.
Adopt these ideas to live with more confidence and joy. Don’t you feel better already?