Facing Up to Your Fears
Let's admit it: the personal finances of many investors are a mess. They don't keep good records; their savings are scattered and not earning nearly as much as they could; and their family budget is all but nonexistant. If this sounds like you, then I have some good news. Yes, you can get your personal finances together.
Your greatest obstacle in doing that is fear. Yet when people recognize their fears of finance, they often choose to confront and conquer them. Fortunately, the three most common fiscal fears are easy to identify. They are fear of responsibility, fear of risk, and fear of wealth - believe it or not.
Victims of fiscal irresponsibility are plagued by inaction. What they really yearn for is someone who will make their financial decisions for them. So, often they unquestioningly invest in what some broker - or perhaps some fairly successful friend - advises them to invest in. And often they get stung.
Then there is the fear of risk. Victims are afraid to do anything with their assets for fear of doing the wrong thing. So they keep their money in low-yielding money market funds or U.S. Treasury securities or Federally insured bank certificates of deposit.
As for fears of wealth, people sometimes feel undeserving of increased incomes or substantial inheritances. And if they have investments, they're afraid to change them even when a security plummets. They feel guilty about earning more than their parents did so their guilt translates into immobility.
Facing up to your fears about money and then taking steps to act and put your finances in order is one way to sleep free of worry or guilt. And, in a world where so much seems to be sliding out of control, it's reassuring to know that, if you're willing to make the effort, it's still possible for you to determine your own financial destiny.
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Your greatest obstacle in doing that is fear. Yet when people recognize their fears of finance, they often choose to confront and conquer them. Fortunately, the three most common fiscal fears are easy to identify. They are fear of responsibility, fear of risk, and fear of wealth - believe it or not.
Victims of fiscal irresponsibility are plagued by inaction. What they really yearn for is someone who will make their financial decisions for them. So, often they unquestioningly invest in what some broker - or perhaps some fairly successful friend - advises them to invest in. And often they get stung.
Then there is the fear of risk. Victims are afraid to do anything with their assets for fear of doing the wrong thing. So they keep their money in low-yielding money market funds or U.S. Treasury securities or Federally insured bank certificates of deposit.
As for fears of wealth, people sometimes feel undeserving of increased incomes or substantial inheritances. And if they have investments, they're afraid to change them even when a security plummets. They feel guilty about earning more than their parents did so their guilt translates into immobility.
Facing up to your fears about money and then taking steps to act and put your finances in order is one way to sleep free of worry or guilt. And, in a world where so much seems to be sliding out of control, it's reassuring to know that, if you're willing to make the effort, it's still possible for you to determine your own financial destiny.
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posted by Bob Moser at
6:50 PM
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