How to look ahead with confidence

4 ways to reduce financial anxiety

31 Jan 2020

The start of a new decade is leaving many investors feeling anxious, particularly given the rising geopolitical tensions and the uncertainty that always comes with a presidential election. The decade ahead may be causing some anxiety, but those same forces creating volatility are also creating opportunity. For example, demographic change will boost emerging markets, and developing technologies in areas such artificial intelligence, cloud computing and gene therapies will mean new investment opportunities.

According to a recent UBS Investor Watch survey, 79% of investors believe that markets are moving toward a period of higher volatility, and 52% are unsure if this is a good time to invest. At the same time, 69% of investors are optimistic about returns for the decade ahead.

If you are feeling particularly anxious, take these steps to reduce financial worry, look past short-term concerns and harness long-term opportunities.

Key takeaways

  • Many investors are feeling anxious about their short-term investments, but 65% of those with a long-term plan feel highly confident about achieving their long-term goals.
  • Arming yourself with basic investing facts can help build confidence and reduce worry.
  • Be mindful of the factors you can control versus the factors you cannot control, like the markets.

1. Learn something you don’t know

When it comes to money and investing, one of the best ways to bust anxiety is to educate yourself. You probably understand more than you think. First, our Own Your Worth research has found that, compared to men, women tend to underestimate their own capabilities while overestimating what’s required to be financially involved, and second, even a little bit of knowledge about investing can go a long way in empowering women to more fully participate in financial conversations and decisions.

Learning something new can be as simple as reading one article about investing a week or researching the different sectors investors are focusing on this year. For example, our My Money Moves site offers guides to making 10 important investment decisions, while our Year Ahead 2020 report goes into detail on the "mega trends" and investment opportunities that our experts see unfolding in the coming Decade of Transformation.

2. Think more objectively about your money

Our anxiety can create a false sense of reality when it comes to money, and investing can be an emotional rollercoaster, so trying to decide on the right amount of investment risk to take (PDF, 1 MB)—and finding the right investment strategy—can be a challenge.

One of the best ways to gain objective insight into your financial situation is to work with your Financial Advisor, who can help you separate fact from fiction and make decisions that help you achieve your financial and life goals.

3. Talk openly about your fears

For those in committed long-term relationships, it’s especially important to communicate with your partner about money and finances, especially your fears. What are you most worried about? Running out of money in retirement? Not being able to pay medical bills? If those fears sound familiar, it’s because they are the top two fears Americans reported in the most recent Gallup survey of personal financial worries. To allay these fears, couples first must discuss them—and then they can educate themselves and discuss the next steps with their UBS Financial Advisor.

For example, our research has found that the average 65-year-old healthy couple in the US needs to have between $300,000 and $600,000 saved for healthcare costs in retirement. Yet just 12% of people in the US have done specific planning for healthcare expenses in retirement. Talk with a Financial Advisor who can help you assess your retirement readiness, and create a plan tailored to help you meet your anticipated healthcare spending needs. Rather than lose sleep over thoughts of the future, create a solid plan to ensure you have what you need.

4. Back away from obsessively monitoring accounts

It’s tempting to check the value of your investments constantly, but trying to time the market—or making decisions based on day-to-day happenings—can be very dangerous. We believe that there are three keys to investing in an uncertain world: aim for resilience in your financial plan, keep your eye on and the long term and focus on what you can control.

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