Imagination vs. Reality

There is an excellent quote attributed to Roman philosopher Lucius Annaeus Seneca. It reads "We are more often frightened than hurt; and we suffer more from imagination than from reality".

I'm not suggesting that fear around COVID-19 is unnecessary. Business and government leaders are currently making a lot of difficult decisions to help stem to spread of the virus and we absolutely need to take heed and do our part as humans in a social contract to help in these efforts.

Yet we can absolutely take it too far and one need not look further than empty shelves of a grocery store to see this. People's imaginations run wild and fear reigns. The result is an unnecessary toilet paper shortage and a complete inability to find pasta or soup tins. If you seriously feel that there will be no food left in a month, then you best stock up on guns as well because society would descend into madness and violence. I don't think it will come to that.

But I would be remiss to not draw parallels to something else near and dear to my heart: financial planning. Every survey and research report I read tells me that Canadians do not have enough savings for retirement. In fact, most have no idea how much they will need to retire. And they don't have adequate insurance to protect their families (Shill alert: I work for an insurance company). Household debt levels are too high and savings rate are too low. It's a major issue and few talk about it outside the financial services professionals I deal with most days. Watching the news recently has made me wonder what would happen if these Canadians put half as much thought into their financial planing as they did to their toilet paper inventory.

COVID-19 is not imagination. It is reality. Though we are letting our imaginations extrapolate the effects of the virus, both short term and long term.

Your financial well being isn't imagination either. It's absolutely a reality, though one that you can hide with a line of credit or underfunded RRSP. But in the end, reality will catch up with you and you won't be able to rush to Costco and buy a fully funded RRSP at age 65.

Do me a favour and use this time of fear and imagination to find some peace of mind. If you have a financial advisor, call them up and have a conversation to make sure you are still on track to meet your financial goals. And (shill again), please make sure your family is protected if something were to happen to you. If you don't have an advisor? Talk to one. If you want to use an online planning tool, fine. Just make sure you have a plan. I for one like having an advisor to keep my imagination in check. Because that is their value. They won't bring you higher returns than the market. They won't magically make you achieve your financial goals. All they will do is help you define your goals and build a plan to get there. And most importantly, keep fear in check as you follow that plan over the long term.

Finally, as we socially distance ourselves and self-quarantine, you don't even need to meet your advisor in person. Video conferencing, screen sharing and digital applications/signatures allow you to pretty much do anything virtually that you can do in their offices. So there is no excuse. Call your advisor today. And if you need a recommendation for an advisor, DM me and I'm happy to refer you to one.

p.s. Wash your hands, don't touch your face, avoid crowds, stay fit and eat healthy.