September 4, 2018

Worry With Us

I was reminded more than once recently by a couple of very different clients of a phrase that I often tell people as they begin to work with us:


“There will come a time when, for whatever reason, worry will creep in and you will feel anxiety over financial stuff for a variety of reasons.  When that happens, don’t sit over there at home and worry by yourself.  Come and worry with us.”


The short hand version of that is: “Don’t worry alone, worry with us.”


We are all human and the strongest of human emotions is fear. This is hard wired into our lizard brains from way back when the risk of being stomped on by a woolly mammoth outweighed the reward of venturing too far out of the cave to find dinner.  That is to say, it is 100% completely natural and unavoidable, deep rooted as a way to protect us from being harmed or eliminated from the planet.


It is such an ingrained part of our makeup that in addition to the rational fears we feel in fight or flight situations, we make up irrational fears around things that might happen or could happen, even when there is no evidence to suggest they are real.  This is the genesis of my repeated quoting of Mark Twain’s famous line:  “I’ve live through some terrible things in my life, some of which actually happened.” Pure gold.


Wikipedia has an entire list of fears that you can check out by clicking here.  Some of them are expected and well known, and some are just bizarre.  As you read through the list, you will find yourself saying, “C’mon man! That’s made up!” and to you, some of these phobias will make no sense.


But each of those on that list is to someone, somewhere on this vast and diverse planet, very, very real. What is irrational to one person may be completely rational to another.


I think what we can glean from this is that fear is personal.  We all think and feel differently, even though we also overlap some.  But the specifics of what worries or scares us is extremely personal and based on an intricate web of experiences, emotions, and thoughts we’ve encountered along our journey so far.  The two recent conversations that inspired this post were very different indeed.


When it comes to financial matters, irrational fears can lead to panic and when it comes to investing, panic can turn what are otherwise temporary declines into permanent losses.  On the other end of the spectrum, greed can be thought of as the financial version of FOMO – the fear of missing out.  It can entice you to lose your adult sense of danger by going all-in at exactly the wrong time.


But with those as the bookends, a lot of financial fear comes in the middle in much smaller and nagging little doses.  Worrying about spending too much or anxiety over the market being “too high”.  Wondering when is the right time to invest since you’ve been sitting on this cash and hate to move it into the market at the wrong time and lose it.  Or maybe it’s making a move that costs you unnecessary taxes, knowing which social security claiming strategy to take, or which of these confusing life insurance options should you pick from?


We are correct in assuming that mistakes can be costly when it comes to money, so we agonize over the timing of decisions and procrastinate or just simply freeze in our tracks and do nothing.  But doing nothing when the woolly mammoth is bearing down is also probably not a good idea.


Lately, the talk has been trade wars, tariffs, record long bull markets, political mid-term elections,interest rates rising, crypto currencies, etc, etc…  There is certainly a healthy amount of paying attention to what is going on in the world for sure.  But in my twenty seven years in the business, I’ve lived through some terrible things that actually happened like 9-11 and the global credit crisis, to name a couple, and also lived through hundreds of fears that never amounted to anything. Anyone remember Y2K, when planes would be falling from the sky mid-flight or when the government shutdown would prevent millions from getting their social security checks?


It turns out, as disturbing as a couple of those were to endure, they were only temporary and the patient investor was rewarded while the panicked investor was punished.


It all comes down to framing and perspective and those are two things that are difficult to achieve if you are worrying alone.  It is helpful to gain that outside set of eyes who maybe be able to lay your fears on the backdrop of some facts and historical perspectives. Armed with more information delivered by the calming confidence of someone who watches and digests this stuff every day, your fears subside and you can return to your regularly scheduled program.


But it’s not all facts and figures that do the trick.  It’s looking another human in the eyes and getting a feel for their mindset and demeanor, and yes, their confidence. It’s replacing your fear with their faith.


You WILL have fears and you WILL at times feel anxious about something related to your finances.  When you do, don’t worry alone. Worry with us.