The Ostrich Error
The Ostrich Error
Have you ever avoided addressing a topic because you were afraid of finding out the real answer? Use the example of getting an annual physical – some avoid taking the time to visit their doctor and have diagnostic tests run because they don’t want to face the fact they’re overweight or haven’t kicked a bad habit. But as your doctor would probably tell you, the longer the problem continues, the harder it is to fix. Worse yet, you think you’re fine but have not given yourself the opportunity to address obvious warning signs. Rather, you use the defense mechanism of an ostrich and “stick your head in the sand.”
Take a peek, you may be better off than you expect
In financial management, acting like an ostrich is rarely the way to achieve financial success. Most importantly, it’s not a wise strategy since your lifestyle and future happiness are at stake. Rather than hiding from your financial situation, if you pick your head up and out of the sand and look your finances right in the eye, you’ll probably discover one of three things:
I am okay and should keep doing what I’m doing.
I’m not okay, but if I change certain things, I’ll be okay.
I’m better off than I thought I was, and I have more options and flexibility with what to do with my life and my money!
Just as with your personal health, if you have a financial problem (not saving enough, spending too much on real estate, etc.), there will be warning signs that a wealth advisor can uncover and help you reset the course. Having a financial plan can help determine where you stand today, if you’re on track to achieve your future financial goals and what actions you need to take to stay on track. For example, what if one of your goals is to retire in 10 years, at age 65? If the results of the analysis come back to show you could have retired two years ago, wouldn’t you rather know that now than spend another 10 years attached to your Blackberry?
Making financial decisions with an extra pair of eyes
If one of your goals is to sell your business to create liquidity for retirement, probability analysis can model the impact of selling at a certain price and whether that would leave you enough to live comfortably for the next 30 years. Knowing these types of answers can help you more confidently make wise financial decisions, especially those that are major, life-impacting ones.
Uncovering what the answer is today is not enough. Life changes, personal and economic circumstances change, and opportunities will continue to present themselves. Adjusting your financial roadmap along the way is necessary, and partnering with professionals who can help guide you can make your experience with financial decisions less overwhelming. After a while, your financial strategy may become less about having enough for yourselves and more about understanding how much you can pass along to the next generation or your community, both now and projected into the future.
These are still answers you need to uncover so that you can make solid estate and charitable planning decisions – especially if you want to be sure you’re using your wealth effectively.
Tomorrow is not promised to anyone, but taking the ostrich by the neck will likely allow you to make well-informed decisions with your money, sleep better at night and hopefully enjoy your life more as the fear of the financial unknown is gone.