Avoiding Sound Bites
I spent the past week on the Gulf Coast of Florida with family and friends. We enjoyed beautiful sunrises and sunsets, the white sand beaches, and the friendly people of the Gulf Coast region. Everything was just as we have grown accustomed to while vacationing in this beautiful area. My wife and I had our doubts that our trip would be feasible when the BP oil spill occurred on April 20th. Our doubts only increased as we watched and listened to the national news. It would have been easy to cancel our vacation based on those initial reports. However, we monitored the situation, made an effort to touch base with people who had first-hand knowledge of the conditions in the area, and then made an informed decision that our trip could take place. Thankfully, we enjoyed a wonderful week together with no signs of the oil spill other than the occasional EPA worker walking the beach side-by-side with other beach goers. Television coverage of the oil spill had almost influenced us to a point of just canceling our vacation this year.
These days, we get our news, as well as our financial information in the form of sound bites. Sound bites like, “gold is going to $5,000 per ounce,” “technology stocks are unstoppable,” “the Dow is headed for a 90% drop,” or “a double dip recession is just around the corner.” We are bombarded each day by 24 hour business channels with cartoon-like characters telling us the sky is falling. We read money magazines promising to deliver ‘can’t miss stock picks’ to its fortunate readers. It seems as if we are constantly being sent mixed signals from a variety of sources about what the financial future holds. It’s really no surprise that many people don’t put the necessary energy into developing a family financial plan, or worse, they simply give in to the confusion and make the decision that, “I don’t know what to do so I’m just going to do nothing.”
Doing nothing can show up in different forms. It could be not enrolling in your employers 401K plan in order to save for retirement, not establishing an emergency fund for when the air conditioning unit decides to die or you get laid off from your job, blindly entrusting your investment portfolio to the latest and greatest money manager, or delaying the start of a college savings plan for your children who will grow up so much faster than you anticipate. In order to succeed financially, you must find a way to block the “noise” and the feeling that you won’t make the right decision.
Start with the desired outcome. What does your retirement look like? What are the major financial hurdles that you must prepare for between now and retirement? Finish with intention. What actions do you need to begin taking now to reach your desired outcomes? Financial peace comes from asking those hard questions, talking with knowledgeable professionals, and making informed decisions with that information. Don’t let outside influences ruin what could be a rewarding financial future.