{"id":1685,"date":"2023-01-19T13:14:31","date_gmt":"2023-01-19T20:14:31","guid":{"rendered":"https:\/\/financialgravityfamilyofficeservices.com\/reyes\/newsletter\/unresolved-resolutions\/"},"modified":"2023-02-06T13:18:11","modified_gmt":"2023-02-06T20:18:11","slug":"unresolved-resolutions","status":"publish","type":"newsletter","link":"https:\/\/financialgravityfamilyofficeservices.com\/reyes\/newsletter\/unresolved-resolutions\/","title":{"rendered":"Unresolved Resolutions"},"content":{"rendered":"

Did you know that January is National Financial Wellness Month? A dogged Google search has failed to come up with the origin of this observation, although it has been taken up by any number of financial institutions, some as a marketing tool and others as a purely educational one.<\/span><\/p>\n

January is filled with remembrances and celebrations. There are daily ones, like National Hangover Day (Jan 1), National Cheese Lovers Day (Jan 20), and Opposite Day (Jan 25). Weekly observations include Letter Writing Week (Week 2), Children\u2019s Week (Week 4) and, of course, National Resolutions Week (Week 1).\u00a0<\/span><\/p>\n

The month of January celebrates a wide range of diverse cultural interests, including Bath Safety Month and Soup Month, among many others. January is also the month that many people make their New Year\u2019s resolutions: to eat healthier, drop bad habits, get in shape, and, as noted above, get their financial houses in order.\u00a0<\/span><\/p>\n

Every day, week and month of the year celebrates one thing or another, and on most days, there are several, often very different things being remembered. These things are by their nature fleeting. A poll conducted by OnePoll determined that February 1st is the day that the average American gives up on their New Year\u2019s resolutions. 68 percent don\u2019t make it that long.<\/span><\/p>\n

Thirty-two days is a tiny fraction of the 15,705 days that many people have to prepare for retirement, presuming they start at age 22 and retire at 65. So why do so many people quit the thing that can have such a profound impact on their golden years?\u00a0<\/span><\/p>\n

According to the poll, the most common reason is a lack of discipline. Reason number two is a lack of time due to busy schedules.\u00a0<\/span><\/p>\n

Noob Gains, a fitness website, finds that 80 percent of people who join a gym in January quit within five months. Fourteen percent quit by the end of February. This is not unique to the New Year\u2019s resolution crowd: 50 percent of all new gym members quit within six months.\u00a0<\/span><\/p>\n

What do financial wellness and gym memberships have in common, beyond both being common areas of resolution every January? We believe, and studies show, that both of these vital personal concerns \u2014 health and wellness \u2014 are improved by getting professional help.\u00a0<\/span><\/p>\n

A study by Steven R. McLaren, published in Sports Science Medicine in 2003, showed that \u201cone-on-one personal training is an effective method for changing attitudes and thereby increasing the amount of physical activity. Secondly, it seems that using problem solving techniques is of value for successful behavioral change.\u201d<\/span><\/p>\n

A study by Northwestern Mutual in 2019 found that \u201cpeople who work with financial advisors are more likely to report happiness, confidence and stability in their financial and personal lives.\u201d Moreover, \u201c92 percent of Americans say nothing makes them happier or more confident than when their finances are in order.[1]\u201d<\/span><\/p>\n

The study has other interesting data points, and here\u2019s a big one: only about one-third of the Northwestern survey respondents said they have actually worked with a financial advisor. Eighty-five percent of those who work with a financial advisor say they feel financially secure.<\/span><\/p>\n

We suggest you don\u2019t need a rock-hard six pack to feel healthy, and you don\u2019t need Bezos\u2019s money to feel financially secure. But if you are among the two-thirds of Americans who don\u2019t work with a financial advisor, perhaps it\u2019s time you resolved to do so.<\/span><\/p>\n

Resolutions That Pay Off<\/span><\/h2>\n

Finding the right financial professional is a fraught process for many people, but it\u2019s not for a lack of choices. In fact, it\u2019s the overabundance of choice that can make it so difficult, due to a behavioral phenomenon known as \u201cchoice under conflict.\u201d\u00a0<\/span><\/p>\n

Amos Tversky is something of a demi-god in the world of behavioral finance. Along with his colleague, Eldar Shafir, he found in 1992 that \u201cthe tendency to defer decision, search for new alternatives, or choose the default option can be increased when the offered set is enlarged or improved.\u201d Meaning: the more choices one has, the more likely one is to freeze and choose to do nothing.<\/span><\/p>\n

If you live in a large metropolitan area, there are thousands of financial institutions and professionals hoping to work with you: stock brokers, financial planners, asset managers, insurance salespeople, mutual fund complexes, and so on. Even in a small town there are often many competing firms and people.\u00a0<\/span><\/p>\n

Rather than making the choice easier, all those options can make it nearly impossible to choose. After all, they may all suggest that theirs is the one best path to financial security \u2014 but that can\u2019t be right, can it? They can\u2019t all be the best, or even produce equal outcomes as they take such different approaches. And many, if not all, are trained in the art of persuasion, which can tickle a subconscious flight instinct.\u00a0<\/span><\/p>\n

There is one category of financial firm and professional that won\u2019t advertise and very likely is not interested in working with you, and that is the family office. Family offices support a single, ultra-wealthy family. There are thousands of family offices in the USA. However, if you could work with a family office, you might find it to be very beneficial. After all, the wealthiest Americans can work with whomever they want, and they overwhelmingly choose the family office. Here\u2019s why:<\/span><\/p>\n