Every day we face a variety of financial decisions:
- “I like three different financial advisors—which one should I hire?”
- “We just got $25K from my grandmother’s estate…should we invest it, use it to pay off some debt, or replace our 13-year-old vehicle?”
- “Should I start taking Social Security benefits at 62, 67, or 70?”
- “Is THIS mutual fund better…or THAT fund?”
When it comes to making financial choices, my observation is that some people struggle all the time, and all people struggle some of the time. What’s behind this reluctance to choose?
After decades as a financial planner, I’m convinced most of our indecision is caused by FOMO (the “fear of missing out”).
Fear of missing out drives all kinds of weird human behavior. It’s at the root of hoarding and excessive worrying. Strangely, it can result in either in the paralysis of procrastination…or the frenzied activity of workaholism. FOMO sparks over-commitment, inhibits our ability to focus, and leaves us perpetually restless and discontented.
Dissect it and you’ll find that FOMO is actually the fear of reality.
What do I mean by that? The essence of economics is making a single choice in a sea of possible choices. By saying yes to one thing, you say no to all the alternatives.
Deep down, we all know this is how the world works. We can’t be in two places at the same time. We can’t spend the same dollar on two different things. We can’t choose one financial planner and still have the benefits of the other two.
And yet we dither. We agonize. We go back and forth in our minds. And sometimes, because we put off making a decision, the decision gets made for us.
Ironic, isn’t it? Our fear of missing out can cause us to miss out!
Because to succeed in any area of life, we’ve got to commit.
Think about all the things we say we want: good relationships, a good marriage, strong families, a healthy body, a secure financial position, a satisfying career, a deepening spiritual life.
All of these things require commitment—and not only when things are easy, but also when times are tough. In fact, I’ll go so far as to suggest that nothing on the above list is as good as it can be until you’ve gone through some hard times, stayed committed, and come out on the other side.
So, what should we do when facing these tough decisions? Three steps:
Step one: Acknowledge your FOMO. Tell yourself: “I can’t do everything. I have to make a choice. And when I do, I will miss out on some things; however, commitment will lead to good things.”
Step two: Commit. Don’t put your toe in the pool, jump in with both feet (and the rest of your body too)! Invest yourself fully in your choice and reap all of its benefits. We could call this JOJI—the “joy of jumping in.”
Step three: Review regularly. Commitment doesn’t imply lack of discernment. Any financial situation—the choice of a financial planner or a certain investment, etc.—should be regularly evaluated to see how it might be improved.
But the important thing is to ditch the FOMO.
Gather your info. Seek wise counsel. Then commit. Make a choice. And review how things are working on a regular basis.
The only thing to fear is your FOMO.
And on that note…if you’re feeling frozen about how to turn your retirement nest egg into regular retirement income, I invite you to take the free, 5-minute “RISA” quiz (email bmoore@argentadvisors.com for the link). It’s an ingenious tool that can help you figure out—based on your unique “financial personality”—the best plan for you.
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