Could a psychological roadblock be jeopardizing your own retirement goals?

David Scranton: Sometimes in a problem a psychological. Yes, we seek help but when it comes to our finances often we don’t realize that the problem has nothing to do with our portfolio. Oftentimes it’s right here between our two ears the question becomes could a psychological roadblock be jeopardizing your own retirement goals? It’s time once again to tune out the hype and focus on the facts, facts that matter to you the income generation. Let’s get started, get ready to separate reality from myth.

David Scranton: How does it affect the market? How does it affect the economy? Thanks to efficiencies and new technology and a staff of veteran analysts and portfolio manager. Sound Income strategy try to set new standards and bring institutional style investing to your portfolio. Hello, I’m David Scranton, if you are a regular viewer and I hope that you are, you know that I believe that the keys to financial success are both external as well as internal. Let’s face it, all the money in the world will not guarantee success if a psychological condition is constantly driving you toward making poor decisions. At the same time a psychological roadblock, maybe what’s preventing you from improving your financial state, not necessarily a lack of options. Today, we’re going to talk about some of the psychological roadblocks that undermine financial success, in retirement planning for people at all earning levels and all asset levels.

Helping us will be our special guest author and life coach Mike Pettigrew. But first, let’s talk about perhaps the most common source of all psychological roadblocks which is fear. On last week’s show, we discussed how scam artists manipulate the two basic emotions that drive everyone’s financial decisions, fear and greed. The extent to which a person can be manipulated by either of those emotions depends on that person’s psychological makeup. Some people are more naturally fearful than others, some are more naturally eager to achieve or obtain i.e., more naturally greedy you might say. But no one is completely immune from the potential pitfalls of fear and greed when it comes to their money. Either it can be the source of a psychological roadblock to financial success and fear is probably the most common of all roadblocks. So let’s take a look at some of the ways that fear be it conscious or subconscious can create a barrier to successful money management. Roadblock number one, what the kids today call FOMO, Fear of Missing Out.

Have you ever been to a baseball or football game where your team was down by a ridiculous amount late in the game? What usually happens in that situation? Well, about half or more of the crowd leaves early while the other half sticks around until the bitter end, hoping, just hoping for a miraculous comeback. Some are motivated mainly by team loyalty, some by natural optimism but many others are compelled by the fear of missing out. They stick around because they’re afraid of not being there to see the miraculous comeback if it actually does happen. That same kind of fear is what compels many people to wait until it’s too late to pull out of a volatile stock market. Or to listen when their advisor tells them to hang in there because the market always comes back, or as we discussed on last week’s show to get taken in by a scam artist. When everybody tells them to look all your friends will be making a bundle on this investment, you don’t want to miss out. Somewhat related to this is fear roadblock number two, fear of being judged. As I’ve discussed before on the show. As well as in my books, good money management often requires having the ability to take the road less traveled. To do with the majority of people are not doing. Confident that’s in your own best interest and simply not caring what other people think or say.

Now that can be extremely difficult for some people, but there are other ways the fear of being judged can create a roadblock. In fact, a recent study followed employees at companies that offered financial education seminars. Despite the obvious need to learn about their finances only seventeen percent of company employees attended. And unfortunately, this is way, way, too common and when surveyed as to why they declined to attend? Researchers paraphrase the typical response this way. Bob doesn’t want to attend his four one K (4,1K) seminar because he’s afraid he’ll see his neighbor there. His fellow employee there and that will be the equivalent of admitting that he didn’t know about money for all those years. In other words, the fear of being judged has created an irrational roadblock to making what most of these people probably know deep down is a smart financial move, and that is to attend the seminar to learn more. A similar roadblock prevents or at least delays many people from consulting with a financial advisor even though they know on some level it’s also a smart financial move. More accurately though, that can best be described as the fear of bad news, in fact, studies show that ninety-two percent of Americans agree that it’s important to get it annual physical. But only sixty-two percent actually do it. Men over forty are in the group that is most likely to avoid checkups and doctor’s visits in general, many cases I think we just don’t want to get the bad news. We know that we’re not taking care of ourselves as well as we should but we’re still afraid of learning that we might be in even a worse shape than we already thought. By the same token, the irrational fear of being told our financial situation is worse than they thought or completely hopeless creates a roadblock, a roadblock, to achieving good fiscal help for many, many, people. Again especially men over the age of forty. Understanding how fear can work against you is one aspect of mastering the inside game, which I talk about a lot in my book Return on principle.

This concept of mastering this inside, internal game. This inside game relates to emotion, goals, life experience and all the internal factors that influence your relationship with money. Including, yes, psychological roadblocks. We’ll discuss the inside game further and share some tips for getting around your own psychological roadblocks later in today’s show. Now it’s time to welcome our guest, Mike Pettigrew. Mike is the author of several bestselling books including Unlock Gratitude Now and the most powerful goal achievement system in the world. He has built and sold more than fifteen businesses and his companies have made millions. But he also knows about the dangers of bad decision making and trusting the wrong people. After selling his first business to a multinational company, Mike lost everything, even reaching a point where he had no money for food, for his wife or their newborn baby. In the end, however, he transformed the situation and went on to become an even greater success. Now he specializes in helping others transform their own circumstances and to achieve their loftiest goals. Mike, it’s my pleasure to have you here on the show today welcome.

Mike Pettigrew: Thank you so much, David.

David Scranton: So for most of our viewers which might be unfamiliar with the story of, your loss and recovery. Do you mind sharing?

Mike Pettigrew: Sure, well I started my first, well actually I started my first business when I was fifteen but I started my real… first real business when, back in 1987 and it was a plant business. We rented and sold tropical plants to offices, and that went great and I built that business over fourteen years, up to the point where I sold it to a multinational. And I thought I’d take an early retirement at that stage but you know what life often has twists and turns we can’t possibly expect and as you said a moment ago. I trusted the wrong people, I made bad decisions, bad investments and just a few short years later it was all gone. Our son was born and I couldn’t feed him or my wife or myself and it’s incredibly frightening when you lose everything and you can’t look after your loved ones. And I suppose it was a double shock for me because I’ve been very successful, I’ve been very positive, very optimistic and that’s served me. And I’m really you know the mind creates and what we dwell upon the most happens. And I really discovered it is going through pure hell I reached the point where I just couldn’t take it anymore, and I don’t know whether my prayer was answered but I vowed to the universe, this has got to change. I must change, I will change and the very next day I picked up a book written over one hundred years ago and that book David, was all about the power of gratitude. And I realized, really it just hit me so strongly how far I had sunk from someone very optimistic and confident and capable. To hating myself, berating myself, doubting myself, feeling so guilty and I realized that if I…it was to change this situation I had to change my dominant thoughts and my dominant emotions. Because that’s what creates our circumstances. Harder reality.

David Scranton: People beat themselves up all the time when something goes wrong.

Mike Pettigrew: Terrible.

David Scranton: You know I had an incident like that too, I talked about on a recent show over the last couple of weeks were I was in my early twenties, I trusted an old high school friend and I actually borrowed money to invest in his company and ended up losing six figures. Now, I was… just me I didn’t have a family to worry about so it wasn’t quite as bad. But I also find when I look back, that that taught me a lot. Not just about gratitude but also more tangible things about, how to make good financial decisions, how to avoid financial decisions. So you know tell me what other… besides the mental game and the gratitude. What else did that experience teach you? To use moving forward?

Mike Pettigrew: To be honest it taught me the power of negative thinking. It taught me, I had to experience the power of positive thinking for many years and it taught me what most people experience. To quite a degree and it was shocking and I’ve come out the other end and it really was through doing gratitude practices. But I’ve come out the other end and like you, I learnt so much, so much from this experience. About the mind, about human beings, human nature, and I’m so grateful for this experience now, so grateful because it now enables me to help people all over the world. Large numbers of people all over the world, overcome their own difficult situations and help them expand they’re, what would you say their degree of possibility dramatically. And I think it comes down to, baby steps. When we take small consistent actions they add up you know the saying. A journey of a thousand miles begins with a single step.

David Scranton: You said not beating yourself up is the beginning of it so listen I hear the music playing in my ear that means we need to go for a commercial break, we’ll be right back in just a minute stay with us, Mike.

David Scranton: If you’re near or in retirement head over to the income generation dot com and download your special report written specifically for the needs of the income generation. Again, those born before nineteen sixty-six. I’m David Scranton and you’ve been watching the income generation.

Announcer: Read David J. Scranton’s groundbreaking new book, Return on Principle seven core values to help protect your money in good times and bad. Discover practical solutions to the financial challenges facing today’s generation of retirees and near-retirees. Learn the truth about Wall Street, the financial media and the secrets they try to hide from everyday investors. This isn’t just another book about investing. Working Americans who have lived through two major stock market crashes and the worst financial crisis since the Great Depression in the past sixteen years don’t need another book about investing. David Scranton’s approach to financial planning is a holistic system designed for maximum protection, strategic growth, and reliable income regardless of market conditions. Stop planning for retirement with your fingers crossed. Read Return on Principle, seven core values to help protect your money in good times and bad available now.

Male voice 5: The point is ladies and gentlemen, that greed, for lack of a better word, is good. Greed is right, greed works, greed clarifies, cuts through and capture the essence of the evolutionary spirit.

David Scranton: We have already discussed fear as the basis of different psychological roadblocks, but what about that other key emotional driver behind financial decisions called greed? Well, most people don’t like to think of themselves as greedy per say and most people really aren’t greedy in the worst sense of the word. But greed like fear is part of the psychological wiring of every single individual whether we like it or not and like fear it’s a basic survival instinct. Farm animals at a feeding trough, usually have little interest in sharing. Each one instinctively wants as much food as it can get for itself at that particular moment, of course, we’re not pigs or chickens. But we are equipped with a similar instinct that compels each of us, to want to get as much as we can, in many situations. We’ve all seen footage of Black Friday sales run absolutely amok. In most cases, these are otherwise rational sensible people who’ve completely gone bonkers with their basic instincts.

Greed and the desire to get as much as they can while they can and yes FOMO, the fear of missing out as we discussed earlier. But, how does greed create roadblocks to financial success? Isn’t getting as much as we can while we can a good thing where the money’s concerned? In fact, isn’t that the very definition of financial success? Well, maybe, maybe not. Why? Because financial success isn’t just about obtaining money, it’s about protecting it and it’s about spending it wisely, and all of that depends upon good decision making. As everyone knows one of the key drivers behind the financial crisis was a subprime mortgage crisis caused in part by this thing called Predatory Lending Practices. Millions of Americans were talked into attempting to finance homes that they really couldn’t afford, many individuals were victimized by dishonest lenders, yes! But many of the victims may bear some responsibility also. Why? Because they allowed their judgment and their more rational instincts to be clouded by greed and ended up making terrible financial decisions because of it. On some level, many were likely aware they were purchasing bigger costlier homes than they could practically afford, others possibly realize they really didn’t have the financial stability or foundation yet to afford a home at all. But they allowed themselves to be manipulated. Why? Because they instinctively want to get as much as they could at that moment. The bottom line is that greed, yes! Can compel us to spend more money on something than we can really afford to spend. That makes it a roadblock to financial success because whenever you’re spending more than you can afford and taking on debt a day of reckoning, is eventually inevitable. But you know there are other ways in which greed creates roadblocks, for investors within ten years of retirement for example or those who are already retired. One of the most common problem is that it delays or prevents you from shifting your focus away from growth and toward income. There’s a stage of your life when it’s smart and reasonable to focus on growing your assets, it’s understandable when you’re in your thirty’s, when you’re in your forty’s, when you want to get as much as you can while you can even if that means investing in riskier assets. But after the age of fifty or so when you’re part of the income generation, it’s more reasonable for most people to start focusing on protecting what they’ve already earned. And on allocating it to provide a reliable income stream for retirement. In fact, regular viewers know that I believe this is perhaps the most important psychological adjustment that people need to make as retirement approaches. The shift from a growth or four one K, mindset as I’d like to call it, to an income mindset, but for many greed can create a roadblock to making that shift. Particularly in a time of fairly consistent stock market growth as of course, we’ve seen in recent years. When the market’s up, most people no matter their age or stage of life are reluctant to pull out or even reduce their stock market exposure. Why? Because they instinctively want as much as they can get while they can get it. This greed instinct takes control even though on some level you may realize you’re at an age where reducing your market risk would be a smart financial move. Of course, this may not be a roadblock to financial success if the stock market never plunges by fifty or sixty percent again. And never wipes out many retirement accounts by that same amount again as it has in the past, and as investors remember, those who still focused on growth learn this the hard way. From 2000 and 2003 when the market dropped by close to fifty percent and again from 07 to 09 when the market dropped by almost sixty percent. But fear and greed are not the only sources of roadblocks to good money management. We’ll discuss some of the others and how to get past them coming up in just a bit. Right now it’s time to welcome back, Mike Pettigrew author of the most powerful goal achievement system in the world. And Mike we were talking a little bit about, some of your own experience that caused you to get… to be motivated to get into this field. But if you had to go back to your own personal experience to say what then the number one emotion was that maybe caused you to make a bad decision in the first place. Simple terms, what was that number one emotion, you think that was the first domino that caused all the others to fall?

 Mike Pettigrew:  It’s so clear, fear David, fear and I sold my company as I say to a multinational. Then basically the way my accountant structured the deal I had to pay a huge amount of tax, huge amount. He told me you could squash the tax bill but he couldn’t and when I discovered that he wasn’t able to help I suddenly started panicking. I thought oh no, I’m going to have to go back into business and you know when you are fearful you make really bad decisions and that’s why I ended up you know with trusting someone. All my friends said you are mad! What are you doing trusting this guy? But you know yeah, fear, fear.

David Scranton: Absolutely, it’s a biggie, I mean do you think that most people are aware about strong a role, personal psychology specifically fear plays in their decisions and determining financial success or failure. Or do you think most are really maybe oblivious to it to a certain point?

Mike Pettigrew: Oblivious, I really believe David, most people are oblivious and it’s not just fear and negative emotions it’s we’re all conditioned. This is the biggest problem but the one thing that stops people achieving a better life, achieving financial freedom and success. Is, well all these subconscious beliefs that we have and you know we’re conditioned from the moment we’re born as we go through life right into adulthood. We’re told how to think and what we can achieve and what we can’t achieve and what not to think and what to think and you know it’s parents and relatives and brothers and sisters and teachers and religions and governments and advertising. By the time we get into our early twenty’s, we have so much baggage we’re not even aware of and it’s that conditioning that holds people back. So if you don’t do something about it, your ability to get to the next level is greatly curtailed, dramatically curtailed.

David Scranton: You know you really do sound like a psychologist now it says everything goes back to your childhood and you’re right when it comes to money. If you think about you know I have stories where even people whom I know personally who maybe grew up thinking oh you know money is evil. If you have a lot of money then you must be taking advantage of other people and as a result, as they grow up and started to make money. They spend it faster than they make it, it’s almost as if money was dirty, it’s like get this money away from me because you know my mom and dad would have thought I’m a bad person had I made a lot of money. We want to come back to you just a minute after the last commercial break so please stay with us for one more segment. One more block, but as we do we’re going to talk more about your process for getting people to set financial goals. We’ll be right back in a minute.

 

Announcer: Read David J. Scranton’s groundbreaking new book, Return on Principle seven core values to help protect your money in good times and bad. Discover practical solutions to the financial challenges facing today’s generation of retirees and near-retirees. Learn the truth about Wall Street, the financial media and the secrets they try to hide from everyday investors. This isn’t just another book about investing. Working Americans who have lived through two major stock market crashes and the worst financial crisis since the Great Depression in the past sixteen years don’t need another book about investing. David Scranton’s approach to financial planning is a holistic system designed for maximum protection, strategic growth, and reliable income regardless of market conditions. Stop planning for retirement with your fingers crossed. Read Return on Principle, seven core values to help protect your money in good times and bad available now.

Miranda Khan: Hello I’m Miranda Khan, time now to take a look at some of the stories that move the markets this week. FedEx did better than it was expected to do profit wise, thanks in part to Federal tax cuts, higher rates, and increased volume. FedEx says its earnings were up twenty-seven percent for this fiscal year. However things are not looking so great for Starbucks, the coffee chain announced that its closing one hundred and fifty stores are mostly located in cities. Where increases in wages and other regulations are making the stores profitable and most Americans don’t have enough money saved for emergencies according to Bank raids financial security index. Just twenty-nine percent of Americans say they have at least six months’ worth of savings while only a quarter say they have no emergency savings at all. For much more on these stories visit Newsmax dot com slash finance now back to the income generation with David Scranton.

Cartoon Character: I’m rich, I’m wealthy. I’m comfortably well off.

David Scranton:income phase. In fact, your success could be the very source of your roadblocks and wealthier comfortable or financially uncertain, there is another common psychological roadblock that crops up or many investors of a certain age. Regardless of their circumstances and we’ll talk about that roadblock coming up in just a bit. Right now it’s time for one final block to welcome back Mike Pettigrew, author of the most powerful goal achievement system in the world. Mike, if you were teaching me about how to set and achieve goals. How would you go about doing it?

Mike Pettigrew:my mapping is fantastic. It stimulates the creative process, that’s number five. Number six is become a high performer and high performance is about succeeding above and beyond standard norms consistently over the long term. And they are very simple habits that Brendan Burchard’s High-Performance Institute have found that these specific habits are adopted by the world’s highest performers and anyone can use them to get way beyond how they… what they would normally do under their own steam that’s number six. Number seven is over and I think it’s the biggest, overcome limiting beliefs, then there is a process, a very simple process to uncover, root out those limiting beliefs that are holding you back. In whatever area of life that you’re trying to improve and then there’s another very simple process to overcome those limiting beliefs, very simple, very simple, simplicity is what human beings need these days. Not complexity.

David Scranton: So in the thirty seconds or so we have left tell us. Is there anybody that’s too old? Kind of rhetorical question to be able to do this type of thing right here and to get excited about their future and then lastly, where can they find your book?

Mike Pettigrew: Definitely, I think David the way to stay perpetually young is to be engaged with the world, to be interested. That is what keeps us alive so it doesn’t matter. I’ve had someone coming to me for about two months ago for coaching he’s eighty years of age and he has his own business at eighty. Now that’s what I intend to be doing when I’m eighty. People can get my book…my book is available on Amazon.

David Scranton: Amazon.

Mike Pettigrew: And it’s about the first page of personal success bestsellers for…well since last October. So I’m really happy about that and it really can, really can change people’s lives. That’s my…

David Scranton: I love it, I love it. I think you should go out, I think you should get Mike’s book. Sounds wonderful, Mike thank you for joining us and you stay with us, we’ll be right back with more in just a moment. Yes, they do grow up fast and once they do they can cause a problem facing many Americans today and that is grown children who remain to one extent or another financially dependent upon parents. In fact, according to a recent Harris poll study, fifty-six percent of parents with children over the age eighteen said that they have paid for their adult children’s groceries. While forty percent have covered health insurance and twenty-one percent have paid for rent or housing. Now many parents said they’ve also helped their adult children pay their cellphone bills, covered car insurance, paid for clothing or entertainment expenses. Even if the financial support you’re providing doesn’t seem like much it can add up over time. Let’s say that for three years you spend ninety-five dollars a month on groceries for your adult child, which is the average amount for someone under twenty-five years old. How much they typically spend on groceries according to the Bureau of Labor Statistics. Well, at the end of three years that’s three thousand four hundred and twenty dollars that you could have added to your retirement fund and started earning interest on. And groceries are one thing, but the real problem often comes from the big-ticket items, for example, the average amount of person under age twenty-five pays for rent each month is three hundred and ninety-two dollars. Now pay that each month for three years and you’ve lost over fourteen thousand dollars that could easily have been invested, but the question is, how is all of this a psychological roadblock to achieving your retirement goals? Well, the roadblock for many people stems from their inability to fix the situation. The inability to say no, to insist that their grown children become financially independent on their own. And you know it is understandable, let’s face it, the parental instinct for most mothers and fathers is as deeply rooted as the survival instincts of fear and greed. So, putting your foot down and exhibiting the kind of tough love you really need to do in this type of situation can, yes be difficult. You may have realize deep down that it’s a smart even necessary financial move but your parental instinct is creating a psychological roadblock. So you keep putting it off, and as a result, you may not only end up putting your own retirement at risk. You may be doing your children more harm than good and jeopardizing their own long-term financial success. In fact, studies show that children show who receive financial support from their parents well into their twenties and beyond are far less likely to be good money managers later on than those who didn’t receive that support. In other words, your own psychological roadblock may be creating different roadblocks for your children. You’re creating the false impression that money does indeed grow on trees, and that is, in this case, the family tree. Stay tuned we’ll be back with you in just a bit. If you’re not using someone who is well trained in fixed income and you’re born before nineteen sixty-six. It may just be time for you to break up with that advisor and move on. I would suggest someone who will care for you through these important years of your life. If you need help finding someone call or write us. I’d also like to remind you of the special report entitled the income generation, this is available free to you, our loyal viewers online. If you haven’t downloaded your report pick it up after the show. If you’re near or in retirement head over to the Income Generation dot com and download your special report written specifically for the needs of the Income Generation. Again, those born before nineteen sixty-six. I’m David Scranton and you’ve been watching the Income Generation, we’ll see you all next Sunday.

Male voice 6: When it comes to an investment strategy many people get caught up in the next big thing or intrigued by a friends can’t miss stock tip. But before you take the dive ask yourself, does this past the what versus the why test?

Monte Resnick: Imagine you are at the supermarket, someone approaches and says hey what are you making tonight? To which you reply not sure, could be a cake, could be a casserole. Unfortunately, this is an example of what investing, this is how most individuals invest. Getting so focused on the ingredients, we lose sight of the absolute objective and goal. In contrast, why investing ask three fundamental questions that should guide all of your decisions. Number one, what are your absolute needs? Number two, what are your desirable wants? And number three, if there’s any money left over, what are your aspirational legacy ideas?

Male voice 6: Talk to your financial advisor about your goals and objectives. If you’re focused on income, a dividend stock or bond strategy may be best. If appreciation is important growth stocks in emerging areas like tech and biotech may be the way to go. And remember you can diversify your risk by investing in Sector indexes.

David Scranton: If you’re near or in retirement head over to the Income Generation dot com and download your special report written specifically for the needs of the Income Generation. Again, those born before nineteen sixty-six. I’m David Scranton and you’ve been watching the Income Generation. In my book, Returnare frankly any number of ways that changes fluctuations and surprises in the financial markets can jeopardize your goals. But in the end, most people who end up not achieving their goals. Don’t fail to achieve them because of the markets but instead because of themselves. They or their advisor have focused too much exclusively on the outside game and have minimized or completely ignored in some cases the inside game. As a result oftentimes a psychological roadblock they never even knew existed has prevented them from making good decisions. Good decisions such as taking that free financial education workshop when it was offered or consulting with a financial advisor even though they realize on some level it was a smart idea. A decision such as breaking off financial support of their adult children, even when they knew deep down it would have been best for everyone. And most importantly good decisions such as reducing their market risk within ten years of retirement and shifting their focus from portfolio growth to that of protection and income. That is a strategic shift, yes, but it can only take place after you’ve made the psychological shift, first. Very often that means becoming comfortable with taking the road less traveled, which yes, is difficult for some people and may require dealing with some psychological roadblocks of your own, the bottom line is that you don’t have to do it alone. A good financial advisor, one who actually understands the inside game can help you not only identify your own mental and emotional roadblocks to financial success. He can help you get past them as well. Thanks for watching, if you’re close to retirement and you, really, really, really, want to know how to protect and maximize your money it’s absolutely essential that you stay informed and up to date. And yes right here is where you can do it on the Income Generation. I’m David Scranton and thanks again we’ll see you next week.