Tricks and Treats
While our business offerings aren’t conducive to any “pumpkin spice” variations, we couldn’t resist an opportunity to incorporate the Halloween spirt into this latest blog post. Money and finances continue to be topics that illicit fear, stress and anxiety for people of all demographics. What follows are several common fears (“tricks”) that center around money and finances, with some ideas (“treats”) on how to make those topics less scary.
Trick #1: The fear of running out of money
Treat: Whether someone’s time frame is a week, year or lifetime, everyone has or will experience the fear of spending down all of their assets. Often times, lack of money management (vs. lack of money) is the driver behind this specific fear. Understanding how to make (and follow!) a budget, what your target savings should be, and most importantly, how to get back on track if you’ve fallen off, are to-dos that can shift the fear into a motivator. Though some spending, like a health emergency, is out of your control, the majority of your expenses can be planned for and adjusted. Consider the trade-offs of big-ticket spending against future financial stability – the answers may surprise you!
Trick #2: The lack of understanding that leads to inaction
Treat: The breadth and depth of the financial world is vast. Also, knowing how to navigate it is a huge challenge. Paralysis can set in quickly if you aim to know everything. Instead, seek out people you trust or admire to learn where they go to broaden their financial literacy. Start by tackling one topic at a time. Read about the basics of mutual funds, explore historical inflation or consider the impact of refinancing debt. The trick is to avoid the “all or nothing” mentality. Gain some knowledge that leads to small financial change now. It is far better than waiting until you have all the information to pursue change years in the future.
Trick #3: The potential of falling for a scam
Treat: Instances of financial abuse scams dominate the media landscape today. It’s so hard to know who to trust and embarrassing when you’ve trusted the wrong person. Extra care must be exercised when it comes to financial transactions. Don’t share personal financial information over the phone with unfamiliar parties. Use security questions or pin numbers to identify people that call you in relation to your finances. Google the name of an individual or company that comes to your door trying to sell their services. Gut check “too good to be true” offers with a neighbor or friend. An extra day or two of due diligence is worth the safety of yourself and your money.
Trick #4: The perception that financial advice is expensive
Treat: As Benjamin Franklin said, “An investment in knowledge pays the best interest.” Engaging the services of an experienced financial planner bears a financial cost. However, many find that the emotional and financial benefits come to outweigh the expense. Be diligent and seek out a fee-only financial advisor to receive the best unbiased advice you can. Recognize that your time is valuable so shifting some responsibilities and decisions to an advisor may relieve pressure and allow for focus on other priorities. Consider the multitude of things that you pay other people to help you with – shouldn’t the success of your financial future be on the top of that list?
White Oaks Wealth Advisors has been helping calm our clients’ fears for over three decades and counting. Thankfully, we don’t have any ghosts of past clients haunting our offices or skeletons in our closets. Happy Halloween!
Laura Bereiter, CPA, CFP® joined White Oaks Wealth Advisors in October 2015. She offers comprehensive wealth, tax, and estate planning to the firm’s clients.