Financial Dysfunction
Financial Dysfunctions- finacial choices and strtegies that people believe are effective but that actually impede their financial progress.
Provocative Wave for Men is going to examine four of the springboards of financial fysfunction, and then explore in more detail how this dysfunction manifests itself in people's financial and personal lives.
#1 Lack of Awareness of Your Financial Personality
People are not aware of their own financial personalities or the common dysfunctions to which they are prone. If you are not making the financial progress you want to be making, the first place to look is at yourself. By getting to know yourself, as well as the inappropriate behavior you might be predisposed to display, you take a big step toward changing your financial life.
#2 Relying on Factors Outside Your Control
People tend to believe that exogeous factors (those factors that are externally generated, such as interest rates or the price of oil) are more important than endogenous factors (factors that are internally generated in their lives, such as how much they earn, how much debt they are carrying, and how they handle credit). This is a fancy way of saying they really control their own financial destiny-even though that seems to be impossible, with all the distractions going on around us and the day's complicated market activities summarized in glorious detail on the hour. Once people understand that they are in control, that what they do will have much more of a bearing on their future than all the rest of the things going on outside, they start to make progress toward financial freedom in a hurry.
#3 Inability to Benchmark Progress
Most people have no idea if they are on target financially (i.e., if they are progressing financially at an adequate rate). Because money is a taboo topic, they are never sure if their neighbors are really better off than they are or where they should be financially at a given age. Many people have never even taken the time to figure out what they want out of life. What could be more important to them? How do you know your making progress if you don't have a clear idea of where you want to go? How do you know you're in good enough financial shape to send your children to college or to retire eventually? Without this understanding, people are never sure how much is enough or even if they are on the right track.
#4 Using Tools and Strategies Designed for Other People's Needs
Almost everything you might read about investing for the future was developed for an audience that is not you. Most investment theories we use today were developed by academics to improve the efficient monitoring of huge pension-fund portfolios. Until you realize that most of the financial information you read is wrong or doesn't apply to you, it is impossible to stay on course.
Most important, you don't need to accept financial dysfunction in your life. You can begin by redirecting your focus and figuring out where you currently stand financially. Then you can lay out some ideas about how you want to measure your progress, get somebody to coach you, and take care of the paperwork.You will rapidly see changes in your situation and experience the security and confidence that comes with being financially functional.
#4 Using Tools and Strategies Designed for Other People's Needs
Almost everything you might read about investing for the future was developed for an audience that is not you. Most investment theories we use today were developed by academics to improve the efficient monitoring of huge pension-fund portfolios. Until you realize that most of the financial information you read is wrong or doesn't apply to you, it is impossible to stay on course.
Most important, you don't need to accept financial dysfunction in your life. You can begin by redirecting your focus and figuring out where you currently stand financially. Then you can lay out some ideas about how you want to measure your progress, get somebody to coach you, and take care of the paperwork.You will rapidly see changes in your situation and experience the security and confidence that comes with being financially functional.
