Today’s headlines about saving for retirement can make you feel anything but serene. The constant barrage of information about how much you need to save and how little time you have to do it can create feelings of anxiety and even a sense of doom. When these emotions are left unchecked, they feed into each other, forming a negative feedback loop that leads to inertia—the worst enemy of financial serenity. Doing nothing to improve your financial well-being only amplifies this cycle. So, how do you break free from this loop and move toward financial serenity?
Here’s what I’ve learned in my long investment career: Do something, and then do nothing.
An important first step toward a secure retirement is to embrace saving money. TikTok and other social media platforms are feeding into a mindset of financial nihilism right now—that long-term financial planning and conventional wisdom are pointless. Do your best to ignore this advice. Thankfully, popular posts on the other end of the spectrum that emphasize “No-Spend January,” “Project Pan” (using up all your makeup before buying new) and “loud budgeting” (sharing your financial goals with others) are gaining momentum. This is social media at its best! Saving money is the easiest way to build a retirement fund. It’s also the best way to squash fears that might be nagging at you about being able to reach your goal of becoming financially serene.
If you are in the early stages of this quest, the slow and steady build-up of savings is a great initial step. If you are further along in your financial journey and still worried about having enough for retirement, a renewed commitment to saving may be your next best step.
As your savings account builds, so will your confidence. The next step to take is to go forth with confidence into the world of investing for retirement. If you are employed and have an employer-sponsored 401(k) plan available to you, use it. Please! My sister is enjoying a comfortable retirement precisely because a caring boss encouraged her to participate in her employer’s 401(k) plan.
There are few things investment professionals can suggest with unrelenting certainty, but the positive impact of participating in an employer-sponsored retirement savings plan is one of them. Take advantage of the opportunity. The plans are typically offered at reasonable costs and often accompanied by advice from financial professionals and educational websites.
No matter where you are on the journey, you can escape any sense of hopelessness by making those annoying social media algorithms work for you instead of against you. Actively click on the posts that emphasize the positive trends mentioned above. Suddenly, a negative feedback loop becomes a positive one.
If you are feeling overwhelmed and tempted to do nothing, try a simple commitment to just one of these initial steps. I am a big believer in the “small wins” strategy to combat the feeling of being overwhelmed.
As you begin to see results, add another step.
Finally, do not be afraid to talk to a financial advisor if you need a little support and/or nudge. We live in a consumption-driven economy, one that depends on the consumer being willing to spend rather than save. It’s easy to fall prey and spend. A financial advisor might be the accountability partner you need to stay the course.
It has become incredibly easy to gamble on the next great bet just waiting around the corner. And the constant bombardment of newsfeeds screaming about inflation, health care and housing costs, and the future viability of Social Security strongly appeal to the urge to make a risky investment or change course.
Resist the urge! I’ve seen many people get overwhelmed or, worse yet, scammed by obtuse investment strategies designed to confuse and separate you from your money. Sometimes these strategies work, but often they end in flames.
Slow, steady and basic still wins the race. Savings and retirement plans can be put on autopilot. Unapologetically! Headlines will still come hurtling at you, tempting you to do something. Try to remember it’s just noise. It can be scary noise, for sure. But it’s just noise. And something else to remember—noise has always been with us. Whether it was delivered by telegram, Walter Cronkite or Facebook, it’s always been there.
You may be relieved to hear that filtering out the noise and doing nothing is a workable investment strategy. It is low key and won’t win you any “street cred” at the neighbor’s barbecue, but it will work. In fact, it will work for years—even decades! You will continue to hear pundits who promote rebalancing your portfolio, new asset classes, or the latest gimmicks, but just remember that at times you should do nothing.
Before you know it, you will be approaching your retirement. Retirement represents a life shift, and it’s a big one. You will shift from earning income and saving money to not earning income and spending money. Like all of life’s chapters, this one isn’t without some anxiety. But with a savings and retirement plan mindset, and perhaps a good pair of noise-canceling headphones, you will go a long way toward relieving some of the angst and becoming financially serene.
About the Author
Sara J. Walker, CFA, has been the vice president of investments with Trusted Fraternal Life since 2021. She has a long career dedicated to managing investment portfolios for nonprofit organizations, individuals and retirement plans. She is a frequent speaker and writer for economic and market updates.
This article is for informational purposes only and is not intended to provide any specific advice. Consult with your personal financial advisor for advice specific to your goals and needs.
