Top 5 Common Financial Fears and How to Face Them | Paradigm Life (2024)

• October 27, 2020

As adults, there isn’t a whole lot that keeps us up worrying at night, but financial fears can creep in at any time. If you’re worried about money, you’re not alone; finances are one of the most common stressors in adults of all ages. Are you ready to get over your financial fears? Here we address the five most common money concerns and show you how to make the shift toward financial freedom.

Financial Fear #1: Unexpected Financial Emergencies

They say that death and taxes are the only certainties in this life, but there’s a third: unexpected bills. At some point, a broken water heater, car trouble, or an expensive medical bill will hit your bank account and cause you stress—unless you’ve planned for it. How do you get over this financial fear and plan for the unexpected? Start by building a solid wealth foundation. Saving 6-24 months of living expenses is sufficient enough to help you weather most financial storms without having to rely on credit cards or expensive loans.It won’t make paying for a new timing belt any more fun, but at least you’ll have emergency savings so unexpected costs don’t send you into a panic.

To learn how to get started on your emergency fund, listen to this episode of The Perpetual Wealth podcast “The Hierarchy of Wealth Part 1: Building a Financial Foundation.” Hosts Patrick Donohoe, CEO of Paradigm Life, and Wealth Strategist Will Street kick off part one of this special four-part series showing you simple ways to structure assets and build a balanced financial portfolio, explaining how the Hierarchy of Wealth can help with both long-term and short-term financial planning, including building emergency savings, getting out of debt, and growing your wealth with less risk.

Financial Fear #2: Unemployment

Regardless of your age, unemployment is a scary thought. Even if unemployment means a retirement you’ve planned for, the thought of not bringing in a steady stream of income can be unnerving, which is why it’s such a common financial fear—it can happen at any time. However, there are more opportunities to earn income now than ever before thanks to remote work, freelancing, and consulting options—to name just a few.

One of the ways you can hedge against unemployment is by investing in yourself. Research what skill sets other employers in your field are looking for and aim to create a resume to match, go back to school or take a community education class, look for online courses you can complete on nights or weekends, read industry reports and literature in your area of expertise, or look for increased opportunities to network. The more value you bring to a company, the harder it will be for them to lose you. In the words of Albert Einstein, “Try not to become a man of success, but rather to become a man of value.”

Financial Fear #3: Not Having Enough for Retirement

Has the thought of never being able to retire crossed your mind? This might be one of the most valid financial fears right now because qualified plans like 401(k)s and IRAs aren’t the ideal retirement vehicles they once were, and Social Security is threatening to run out, leaving more and more Americans unprepared for retirement.

Luckily, Social Security, 401(k) plans, and IRAs aren’t the only ways to fund your golden years. Did you know you can use whole life insurance for tax-free retirement income? And it’s not too late to start—even if you’re already retired. In fact, it’s one of the most common uses for cash value in a whole life insurance policy, often outperforming 401(k)s and IRAs and offering better tax advantages.

Financial Fear #4: Debt

Due to the easy access of money via credit cards, combined with economic ups and downs and student loans, many Americans are drowning in debt. If you’re looking for solutions to help eliminate debt quickly and/or prevent future debt, you have options. In fact, a whole life insurance policy might be the answer to help you consolidate your debt, pay less interest, and finally get ahead financially. Take a look at this quick read on the Paradigm Life blog, “Tools and Strategies on How to Eliminate Debt Quickly.”

Financial Fear #5: Losing Money in Investments

The financial fear of losing money in the stock market is front and center on most investors’ minds, and rightfully so. The market naturally experiences ups and downs, including dramatic market corrections like the Great Depression and Great Recession. Luckily, there are ways to protect yourself from the next market downturn.

If you take a distribution or withdrawal money during a market downturn, your account may never recover back to its original value. What if there were another account you could borrow from to fund retirement or business expenses while you wait for your market-based accounts to rebound?

There is. Known as the Volatility Buffer strategy, this method outlines ways you can use non-correlated assets to grow and protect wealth, regardless of what happens in the market. In fact, Paradigm Life clients who utilize the Volatility Buffer strategy in conjunction with their other qualified plans and investments, can end up with hundreds of thousands of dollars—even millions of dollars—more for retirement and their families.

If you’re invested in the market, The Volatility Buffer Toolkit is a must-take eCourse offered for FREE by Paradigm Life.

Overcome your Financial Fears

Don’t let your financial fears get in the way of enjoying the life you’ve always dreamt of. We specialize in financial education and are here to help you every step of the way.

At Paradigm Life we can customize a policy to fit your financial situation. Our expert Wealth Strategists are available to answer your questions and show you customized illustrations, outlining an individual plan of action to help you achieve your goals. , no strings attached.

• Tags: Perpetual Wealth Strategy