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Five common reasons why people put off saving

It is human nature to procrastinate over big decisions. Director, Cherie-Anne Baxter, explores why people put off saving and what makes us cautious about investing.

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Life's big decisions

I was caught off-guard at a recent event when a gentleman asked me about what big decisions in life I put off making. A group of us, ranging from our 30s to around 60s, thought the hardest big decisions were whether to get married or not, what to call our children or pets and money decisions.  We all agreed that it doesn’t matter what age you are, you never really feel like you have reached adult-hood. I left feeling relieved that I was not the only one who massively procrastinates over money matters. Why do we put off saving? What makes us cautious when it comes to investing? With the help of some of Unividual’s financial planners I explore the five common reasons people put off investing.

1. “We can't spare the money right now”

With all the costs of raising a family, clients often worry they don’t have any money to put aside for investing. You get busy balancing work life with channelling every penny into the home and if your a parent, in to your children. How do you know you are saving enough for retirement? Have you visualised what your future looks like after the children leave home or once you near retirement? By asking these questions you can start to see the benefits of financial advice to achieve your long-term goals. There are areas in all our lives where we could claw back. My Unividual financial planner, Lewis Baxter, once told me “instead of thinking about what you are going to give up, it’s more about what you stand to gain from those savings.”

2. “I haven’t got the time to think about investing”

With a full time job, that’s not 9-5 anymore, it’s too easy to use time as a rationale for not planning your finances. A recent YouGov study found 47% of people have never thought about making changes to their pension!  Your time is a premium and this is one of the main reasons people outsource their financial planning to a professional. When we start to talk through your choices, you might see that actually it is stress that is the main barrier, often confused with a feeling of not having enough time. You might think, “I have enough decisions at work to make, without adding to them.” You can reduce your stress when you get help with your finances instead of avoiding it all together.

3. “I worry I will make the wrong decision”

Recently we had a client who was keen to make some investment choices for her family. She wanted to start saving for their retirement in over twenty years’ time but just thinking about big financial decisions gave her sleepless nights. What is important to realise is this isn’t uncommon, so don’t be afraid to admit it if that is how you feel. Over four million Britons have trouble making the right choices when it comes to difficult decisions. Which is why we spend a lot of time making sure our clients are informed about every detail, and every option, so they can choose the level of risk they wish to take. The best tonic for any fear is to talk about it and grow your knowledge.

4. “I’ve got too much going on now to get concerned about the future”

You might have young children, elderly parents in care or you might be thinking about your own old age. It is so easy to become ruled by the day-to-day choices that surround a hectic family life, rather than the plain facts of what we want for our future. Professor Mark Fenton-O’Creevy, Professor of Organisational Behaviour at The Open University Business School says, “People will procrastinate when a decision makes them feel anxious. They will also procrastinate making a decision if they feel they are incapable of making it.” Once you accept that your future could be un-achievable if you don’t start to plan, it is easier to see the big decisions that need to become a priority.

5.“I can’t lock away money, what if there is an emergency”

Putting money away for a long period of time can be an enormous worry for people. You think, “What if we need to access that money for an emergency?” It’s a very common concern, and completely understandable. Caution is a sensible human trait after all. It’s good to understand the nature of your fear and the reality of how much emergency money you need to make accessible. Additionally, the financial market is full of options with plenty of investment products and packages out there that allow for change and flexibility.

My Mum Is Always Right

For me, putting off anything, from your health to your career, can have a detrimental effect on your life. My mum used to say, “The longer you leave it, the harder it gets”.  Like most Mums, she was right and it is certainly true of financial planning. I am really proud of what we do at Unividual. We make a difference to peoples’ lives, giving our clients the best chance to grow what they have and achieve their goals. From house buying to retirement, more money breeds more choices. So, try not to let time, worry, stress and procrastination prevent you from the first step to taking control of your future.

Date of article: 13th November 2019

Author: Cherie-Anne Baxter

Editor: Cherie-Anne Baxter

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