Heather Pearson, Associate Financial Planner
The connection between money and emotion may be difficult to see however, upon further reflection,it becomes clear the two are inextricably linked.Money comes into play a multitude of ways during significant times in our lives: the death of a loved one,purchasing a home, or facing a health crisis, to name just a few. Each of these scenarios, in and of themselves, leave a person in a heightened emotional state, which can easily be compounded by the addition of financial stressors. It is when navigating these sorts of difficult situations that a person is most prone to making costly financial decisions that will have far-reaching implications. It is in anticipation of these sorts of emotionally-significant events that it is particularly important to have someone you trust on your team who can help you separate the emotion from the financial reality and guide you in making sound financial decisions.
As a financial planner, it is important to understand the emotional impact money has had on my clients, whether conscious or subconscious. If I understand a client’s emotional history related to money, I can better equip them to navigate the financial circumstances that come their way. The paradoxical role of emotion in financial planning is this:it’s important to truly understand our own emotional patterns related to money. When we “name” them and identify those patterns when triggered, this allows us to make sound financial decisions despite the emotional triggers.
Having the knowledge doesn’t always translate into actions toward the desired outcome. So how does one go about unpacking the role your emotions may be playing in your financial decisions? It’s a path best walked with a financial planner by your side. Hiring a good financial planner can help you clarify your values, goals, and dreams, and understand the role emotion has played for you related to your finances. A financial planner can also help by providing an outside perspective on your investment decisions. When 85% of your portfolio is tied up in the stock you inherited from grandma and your sentimentality is outweighing your ability to see that you need to be more diversified, we’re here to help. When you and your spouse need an unbiased third party to facilitate and moderate a difficult conversation about your finances, look to us. Wanting to leave a legacy to your grandchildren? You guessed it – a financial planner is the person to call on. Just as you would hire a coach, therapist, or attorney, a financial planner can meet you where you are, help you to clarify and prioritize your financial goals and unlock your potential through emotional discipline.
Opinions are those of Heather Pearson and not necessarily those of Raymond James. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional.