“Money anxiety disorder” is a term used by psychologists to describe a condition of constant worry and unease about money. The term seems to have come into use around 2008 to 2009, when the economy was unraveling and most people were concerned about their financial well-being. Additionally, research has shown that women seem to suffer from money anxiety more than men. Here we look at what it is, how to recognize it and how the financial planning process might help.
Do you know how much a half gallon of orange juice costs? Think carefully. What was once a 64-ounce container of juice is now 59 ounces. A pint of Hagen Daz is just 14 ounces (Ben & Jerry’s still has a 16 ounce “pint.”) How do you compare? Take another example, hotel rooms. I found a great place to stay in Sonoma for under $200 a night in February. This summer there was nothing under $300 at the same place. I recently purchased artwork for my office. I had no idea how much to offer, except that it had to be lower than the asking price! Plane flights, cars…ditto. Clearly, some prices do vary based on seasonal factors. Yet, is there such a thing as the “real” or best price for anything?
...When an old acquaintance saw the name of my business, Stoffer Wealth Advisors, he said, “As soon as I have some wealth to manage I’ll give you a call.” Clearly he was thinking of wealth only in its most narrow definition: an abundance of material possessions or money.
When we believe more is the answer, it can impact us in unforeseen ways. Humans just want more. We want more happiness…more money, more success, more time, more vacations, more life. Aspiration does seem to be a healthy thing. As humans, we seem to value growth and progress. However, money represents many different things to different people. When it comes to money, needing more, wanting more and having more can be complicated. The danger in the pursuit of money is that you risk falling into a rabbit hole - where you find yourself navigating a seemingly endless confusion of paths and choices, and where it is so easy to lose your way.
In the new movie “All the Money in the World”, Mark Wahlberg’s character, Fletcher Chase, asks J. Paul Getty how much it would take to make him feel secure. The answer…“More!” It was an odd statement from ostensibly one of the richest men in the world at that time. Based on a true story, Getty’s grandson has been kidnapped (one he’s particularly fond of) and the ransom demand is $17 million. Getty won’t or can’t bring himself to part with the money even though we’re certain that he has it.
Recently when the subject of financial planning came up, a woman said to me, “I really should do that.” I was staring at my computer one afternoon, thinking about the pervasive effect of the phrase “I should . . .” on our daily lives. It almost doesn’t matter what follows those words, “I should . . .” – lose weight, do my taxes, get the car fixed – whatever it is, the phrase which masquerades as motivation so often has the opposite effect – of inducing procrastination. It can make us feel as though someone else is trying to impose his or her will on us.
A while back Michael Finke, Professor of Retirement Planning at Texas Tech University hosted a webinar about financial planning in the context of longevity and aging. None of us likes to think about the deterioration of our physical and mental abilities. Yet how we navigate these changes, and equally importantly, how we plan for them, will have significant effects on our future happiness. Life expectancy has increased for a number of decades and the trend continues. Finke concludes that definite connections exist between income, health, social activity and longevity and happiness. Generally, those people with higher income tend to enjoy better health and are more socially engaged. These factors contribute to greater longevity and increased satisfaction in retirement. The webinar raised a number of interesting questions in regard to retirement. I’d like to discuss the following two issues: first, whether to remain in your home as you age, and second, how declining cognitive abilities affect the management of your finances.
We use money every day. We spend on things, experiences, etc. Maybe you are planning the next big adventure in your life…or figuring out how to save the money to remodel the bathroom. Behind these activities there is a presumption that money used in these ways will make us happy. Do money and happiness even belong together in the same sentence? In some of my workshops participants fill out a survey asking them to agree or disagree with statements on money beliefs. One of the statements is “money makes me happy.” I never kept a specific tally but I always looked at whether they checked yes or no on that question. My recollection is a fairly even split between those who agreed with the statement and those who didn’t. I wonder if some checked “no” because we’re not supposed to find happiness in such a thing as money