Money draws upon many of our human emotions, but is most closely linked to love. Fear, in some ways the opposite of love, is perhaps our most innate and adaptive emotion. Faith is something based on confidence that is not dependent upon proof. All of these emotions play a central role in how we make financial decisions.
“Moving Out” of our Emotions
The root of the word “emotion” is derived from the Latin emovere which literally translates to “move out”. In a sense, to accomplish our financial goals, we have to “move out” some of the damaging aspects of our emotions and recast our gaze on the primary equation of money=love. This equation is not new, of course, as the Gospel writings contain numerous associations between “heart and treasure”.
As strong as fear and love are, nothing happens until we act – until we do something. That something, saving for the future; silencing the day-to-day “noise”‘ focusing on what you can control, requires faith. While the word “faith” is a noun, a state of being, in order to be effective, it should be treated as a verb.
In our 32 years in business, we have always worked with clients, essentially in the same manner: Objective, transparent and honest. What has changed, however, is that we used to emphasize convincing clients that our approach was correct. Spreadsheets and statistics might “prove” our advice, but in reality, this enables the part of the brain that usually does not act. Great advice with no action = no progress towards goals. Today, we simply persuade clients to do what is in their best interest. Ultimately, this requires faith.
Since money decisions are oriented around a framework of future goals, faith in the future is an important raw ingredient. While it is easy to become distracted with day-to-day problems, pessimism is an anathema to a successful long-term investment strategy. Got faith? Ready for a real conversation?