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The word procrastinate comes from Latin, "pro" (forward) + "crastinus" (belonging to tomorrow). So in a nut shell when we say we have trouble procrastinating it means that we tell ourselves that we'll do it tomorrow—or some other magical time when we have the time, energy, or money. When it comes to money and financial planning I've seen that there are four main reasons we procrastinate.
1) Fear of Change
We are comfortable where we are, or at least comfortable enough that we're afraid to go do something else. Similar to going to the gym, we know that if we do the diets and exercise it will not feel great. So we promise ourselves we'll start next time. 44 percent of people surveyed by the Federal Reserve said they feel more stressed by money than relationships or work. But yet, we get stuck in our comfort zone and do nothing. We do what we've always done because the other path is dark and scary.
2) Who to trust?
With money it's so hard to know whom to talk to! Our families typically don't talk about it. And we're not quite sure if asking a teller or even a banker about credit or insurance makes sense. 57 percent of people say their top priority in an advisor is “someone I can fully trust to have my best interest at heart and not just selling product.” Most insurance agents sell products for commission, and most wealth managers won't take anyone that has less than a certain threshold of assets. So if you're a regular working class family, who do you talk to?
3) The costs seem too high.
It can be very intimidating to think about the costs when going to try to update one's financial life. A typical financial planner will charge $2,000 to $3,000 upfront for a financial plan. Some "fee only" advisors will then send the clients off the get insurance or investments on their own after that. Products like life insurance or long-term care insurance can eat a chunk of a family's budget if they are not properly placed based on their goals. And as mentioned, many advisors who only charge fees for "Assets Under Management" will have a minimum such as $250,000. So if you only have $100,000 what do you do?
4) Life is busy.
This is actually the number one thing that I hear when clients or potential clients can't meet. It's the start of a new year, let's catch up in February. And then oh, we're traveling for Valentines day, let's try March. I landed tickets for March Madness, let's try April. Sorry, the spring got away from us with our daughter's Tennis schedule, let's shoot for summer. This summer has been too crazy with camping trips, sports tournaments and trips to the cabin, let's try fall. And then before we know it, the holidays have come around and then it's "let's shoot for the beginning of the year" again! You know how time flies, so just imagine waiting 10, 15, 20 years to genuinely build a good financial plan.
So, that’s why we procrastinate. What do we do about it?
5) Decide that you are prioritizing your finances.
That is a huge first step. Just like your first kiss, it may have been a little scary, but you decided you were going for it! Once you've decided you're ready you can meet two, three, five financial advisors or coaches until you've found the right one.
Deciding to move will start things going. I saw a great Instagram post that talked about saving one penny per day and then increasing it, each day until you get to the end of a year. The last day you would deposit $3.65 into your jar or bank. What would the total be? $667.95! Just increasing a penny per day! But you have to decide to make moves. Imagine it was a dollar per day…
I know that life is busy, but in my experience there is nothing else that can so positively impact your life than improving your finances. Having a budget allows you to have disciplined freedom. Having insurance reduces your worries that things may happen, and if they do happen your family can bounce back quicker. Having a long term financial plan can allow you to potentially see that you can work less, or hire someone to do the yard work so that your Sunday's aren't so busy.
Decide you're ready, and take some steps towards the financial future you desire! Work towards becoming the person you want to be with money.