Are Your Finances Focused on Ideas or Action?

Turning Financial Ideas Into Action

Insights, forecasts, and predictions don’t generate change all by themselves. Discipline and execution are needed to turn good ideas into real world results.

You can comprehend why a certain financial concept or investment might be beneficial, but nothing that impacts your future happens without taking action. Belief and action are separate.

Your personal financial life is one place where good intentions don’t really move the needle. You’ve got to eventually make concrete decisions on how much to save and exactly where to invest. The “shiny objects” that comprise emotionally appealing financial strategies can easily end up as distractions if you’re not careful.

Martial arts expert and author George Leonard in Mastery wrote “Put action above thinking or intending.”

You probably know what works for your circumstances, but knowing and actually doing it are two different things.

How Emotions Affect Financial Decision-Making

Much of your financial success or failure over time comes down to understanding and managing your emotions. There are six generally recognized human emotions: fear, disgust, anger, surprise, joy, and sadness. Which emotions cause you the most trouble when making financial choices?

Are you fearful of making decisions that involve some risk or do potential surprises worry you even more? In my experience these two emotions, fear and surprise tend to be the most problematic for investors.

Separating Financial Noise From What Matters

The flood of financial information updating in real time on your devices doesn’t help with managing these emotions. By some estimates, the average American checks their phone more than 200 times each day. While you might be looking for signal, it’s mostly noise.

If you find yourself checking financial information on your phone or computer several times each day, you’re being consumed by noise. You are mostly seeing information that has no particular relevance for your circumstances.

While noise can distract you from focusing on what really matters, it also nudges you to act based on this information.

The marketplace for your attention is nearly impossible to avoid. Financial product marketers spend heavily on ads and social media to persuade you that what they sell will solve your financial needs.

When Too Much Information Leads to Inaction

The fact that you have access to moment by moment financial information can make your decision-making process harder. It’s at this very stage that some investors freeze and refrain from any affirmative action. No decision actually is a decision but likely won’t move the needle for your financial future.

In his new book *Stay Calm, *Dimensional founder David Booth writes,”When it comes to investing, a lot of things are interesting without being meaningful.” Put another way, much of what you read or see on TV is entertaining, but not particularly useful to you.

Remember, when you see someone predicting what the stock market will do next week, this is probably more of a wish than a forecast. The future is unknowable and even experienced investors don’t possess the ability to know what might happen in the short-term.

Focusing on Long-Term Financial Planning

The amount of extraneous information that you ingest each day is staggering. Very little of this is applicable or useful in your long-term financial planning efforts. All of this useless information can easily crowd out what matters most to you.

Ask yourself why you are overly focused on investment ideas. Is it because you are just being entertained or because you’re behind schedule in meeting your financial goals? An honest answer to this question will reveal a lot about your financial fitness. 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.