Financial Objectives: Are You Faking It?

Financial Objectives: Are You Faking It? by Hayley Carr, Burgundy Blog

Have you ever found yourself in a conversation about finance and, in a moment of incomprehension, rather than ask a question you simply nodded along? Perhaps it was a conversation with friends or colleagues, or perhaps it was even with your financial advisor. Much of the investment industry is built upon moments like these full of technical jargon that leave you feeling in the dark, thereby resolving to “leave it to the experts.”

You’re not alone. People generally have difficulty admitting when they do not understand something, and this is especially the case in the world of investing. A recent Globe & Mail article (The hardest words to say in personal finance? ‘I don’t understand.’) cites a survey in which participants were tasked with answering questions about their finances. The twist? Some of the survey questions featured fabricated financial jargon. For example, as many as 18.5% of respondents said they owned a “variable-income securities vehicle,” while 8.5% of men and 4.2% of women reported they have owned “white chip stocks.” Both of these terms do not exist.

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One line of the article, in particular, resonated with me: “When you fake it with your own finances, you give others power over your money.” Our Women of Burgundy community’s mission is to help women make investing a priority, and this quote sums up the meaning behind our mission statement. If you fake it (or disengage), you relinquish your control and understanding of your own money. The flip side is to engage, gain the confidence and conviction in your investment decisions, whether you are responsible for your own stockpicking or for deciding the investment manager with which you will entrust your nestegg. As evidenced by the results I mentioned above, this is by no means limited to women; rather, it is something all investors must remain aware of, and work to overcome.

The moral of the story: when in doubt, ask questions. Never hesitate to ask for clarification. You will be glad you did, and so will we. Indeed, an investment manager who is truly looking out for your best interest should be happy to answer your questions, because the more clarity you have surrounding your own investments and financial objectives, the better we can position your portfolio to best meet your goals. As it is concisely stated in the article, “Own your ignorance. Use it as a weapon to build your own knowledge and test the skill and character of the financial industry people you deal with.”

Finally, to our clients – we encourage you to attend this year’s Client Day on June 6th, in person or remotely, via webcast (invitations are on their way imminently). Take the opportunity to hear directly from the people behind your investment decisions, and ask questions – either during the presentation, or one-on-one after the fact over cocktails. Remember: “you have to fake it ‘til you make it” may be a common expression, but it should never be applied to your investments.

Financial Objectives