Are You Frightened or Focused?

Staying Focused on Your Financial Future

In our topsy turvy world today it’s easy to be frightened about your financial future. Maybe you’ve lost confidence in the economy, financial markets, or the political structure. While there are always worrisome events happening somewhere in the world, it’s important to stay focused on achieving what matters most to you.

The investment markets react every day in real time to both good and bad information. There are millions of participants in these markets, some with views like yours and others with different perspectives. While markets move up and down it’s important to remember they continue to function even in turbulent times. David Booth, co-founder of Dimensional recently wrote, “I see it as markets making order out of chaos.”

While you might seek certainty about your financial future, the exact way that future events unfold is both unknown and unknowable. This reality is why many investors seek financial planning guidance in the first place.

Managing Uncertainty Through Financial Planning

There’s a long history in economists and financial pundits extrapolating current events into future outcomes. If only it were that simple. What’s generally missing from this type analysis is exactly how people will adapt to changing conditions. That’s very difficult to know in advance.

Making financial progress toward your most important goals requires that you come face to face with the unknown aspect of the future. Fear can create doubt in your mind and this can morph into inaction. It’s critical to realize that your financial aspirations revolve around action, not inaction. Managing your innate fear about the future can be a valuable financial skill.

Defining the Goals That Matter Most

Sometimes you need to more closely examine your goals to make sure they are what you truly want. To paraphrase Shakespeare, you should decide if you want to float with the tide or swim toward a goal. Is it the actual goal that attracts you or the lifestyle that goes with the goal? There’s a difference.

Think about what matters in your life. What’s important, who’s important. This can be helpful in teasing out your goals.

Taking Action Instead of Letting Fear Take Over

Delaying concrete action toward your long-term aspirations often comes with a cost. If you’re in the asset accumulation stage of life, missing out on potential returns can have a deleterious impact on your long-term future. Don’t overthink so much that inertia takes hold.

If you’re trying to wait until everything is clear and calm to invest, that time may never come. In my experience when you try to wait for the perfect moment to invest, it’s often because you can’t imagine enduring the discomfort of temporary setbacks. Best selling author Morgan Housel says, “the trick is not minding that it hurts.”

Keeping Your Financial Future in Focus

If you’re nearing retirement or already retired, your overarching objective probably is to have income that increases over time to offset the eroding purchasing power of inflation. It’s difficult to accomplish that objective without taking affirmative action steps with your investment portfolio. The status quo probably won’t get you there.

Neuroeconomists have been researching brain wiring for decades. Many surmise that the limbic system feels emotions and then develops an explanation for those feelings. This is the same portion of the brain that controls your fight-or-flight decisions. Your financial future is surely worth fighting for. Be careful not to let fear overtake your focus. Start there. Ready for a real conversation?

Disclosure

Apollon Wealth Management, LLC dba J.E. Wilson (Apollon) is an investment advisor registered with the SEC. This document is intended for the exclusive use of clients or prospective clients of Apollon. Any dissemination or distribution is strictly prohibited. Information provided in this document is for informational and/or educational purposes only and is not, in any way, to be considered investment advice nor a recommendation of any investment product or service. Investing involves risk, and while remaining invested can support long-term goals, it does not guarantee a profit or protect against losses. Advice may only be provided after entering into an engagement agreement and providing Apollon with all requested background and account information. Please visit our website https://apollonwealthmanagement.com for other important disclosures.