Build Confidence in Your Financial Future
Consumer Advocate Offers Eight Great Things Everyone Can Do to Brighten Their Financial Outlook
Washington, DC, October 19, 2011 – Negative news is dominating the media – from a looming default in Europe to stagnant economic growth in the U.S. According to Certified Financial Planner Board of Standards Consumer Advocate Eleanor Blayney, CFP®, these persistent woes are fueling negative consumer financial behavior that is threatening an economic recovery.
“Our national problem is really a lack of confidence and certainty,” Blayney says. “Because there has not been much economic upside lately, we are becoming fixated on negative information and it’s clouding our judgment about the future. People have stopped spending on critical goods meant to replace old or worn-out products – spending that is crucial to an economic recovery. ”
To break the cycle of negativism, Blayney offers eight great confidence builders that everyone can do to improve their financial outlook.
- Disconnect from the negativity. Unplug the TV and turn off your wireless devices. Recognize that repetition does not mean intensity. Just because you’ve heard the negative news about economic growth four times from different sources does not mean that it is four times as bad.
- Live With the New Reality. If you haven’t fully absorbed the existing bad news in your expectations, it’s time to get it over with. That means accepting the current value of your home, your 401(k), or your brokerage account, and building a financial plan from there. It is much easier to remain confident if you see yourself making a fresh start toward building your financial security rather than waiting for the good times to return.
- Weather-proof. Build your investment or retirement portfolio to withstand the good times and bad. Focus on high quality investments and an allocation that you can maintain through thick and thin. A well-diversified portfolio will always have a slice of “good news” – something that is doing well in hard times.
- Live within your means. Your paycheck, rather than the GDP numbers, should be your economic bellwether. If you have predictable and steady income, make sure you are setting some aside in the event that your employment situation changes. When you have money left at the end of the month rather than having to borrow ahead, your outlook on the next month – and the next – will improve significantly.
- Educate a child. Just spending time with a child – observing their energy, curiosity, sense of wonder and imagination – inspires hope for a better future.
- Learn a new skill. Study a new language or take a course in a subject matter that you never studied in school. Expanding your horizons opens more possibilities for tomorrow, in terms of careers, supplemental income and personal satisfaction.
- Give it away. If you want to feel “rich,” make a contribution to someone less well-off than you – your favorite charity, a family member, a friend. Or if money is truly scarce, donate your time. The sense of connection to others, and being able to help, usually puts our own financial difficulties in perspective.
- Make a financial plan. CFP Board research has demonstrated that those who draw up a written financial plan – ideally with a CFP® professional – have more confidence and are prepared for what is to come.
According to Blayney, the key is to focus on the things that each of us individually can control.
“It’s not a matter of whistling in the economic dark, but actually taking concrete steps to illuminate the course forward,” Blayney says. “Confidence that you are on the right path is the first, most important step toward financial security.”
# # #