In the contemporary world, it is close to impossible to escape the media and news; this is especially because of the smartphone penetration that makes people receive news in real-time. The media often has an impact on your financial decisions; however, you may not realize it. Therefore, it is necessary to know the impact of news on your financial decisions to ensure they are upright for you.
The main agenda of media and news is to sell; therefore, you will often see catchy headlines. You may encounter a headline such as “The Iraqi Dinar Guru” and be intrigued about what it entails; that way, it has captured your attention. There is often a lot of information.
Besides the news on the financial sector, the news on the state of economic affairs will tend to influence your financial decisions. For instance, news headlines regarding fast-growing industries and the challenges facing the high street will affect how you make your financial decisions. Updating yourself through newspapers or social media can be challenging as you will not be sure how to filter out what matters to you.
You might feel that you are hardly influenced by news and media when making financial decisions, but the truth is it may have impacted you at some point in the past. Examples include:
- You may have encountered news pointing out that the economy is suffering or there is inflation. Therefore, you went ahead and held back or slowed down investment deposits and decided to hold your savings in cash. If an economic slowdown occurred, you may have felt that you reduced the impact it would have on your investments if you had made them. However, after some time, you found out that investments outperform cash in the long run, and the media negatively affected your decision; therefore, you lose money
- On the contrary, you may have seen the news about some outperforming funds or people who have made overnight fortunes by investing in certain industries. You may have felt the dire need of wanting to risk your funds for the same. Seeing the stories in the regular media about unimaginable returns may make you feel as if they are more likely to be a reality
Financial Planning as a Solution
If the media impacts your financial decisions, you can use financial planning as a solution to the influence. It offers a solution for these four key reasons:
Bringing Your Focus Back
The news will often be unclear. There are myriads of opinions out there, and they will have people wonder about the best steps to take in the financial journey. That is because whichever financial steps you choose depends on personal circumstances at a minimum. When you practice financial planning, financial decisions are brought back to you.
Get Regular Reviews
Everything in the financial realm changes over time, and those changes should reflect in your decisions and plans. Therefore, you should engage with a financial planner whereby you can take advantage of regular reviews enabling you to be on the right track. A review eases your concerns, for instance, when you are worried about the economy’s performance and the direct impact it has on you.
The overall decision and financial plan should be made with confidence. Therefore, financial planning should aim to achieve confidence when making those decisions. Having a plan that is engineered for you will help you bar the media noises, which could be wrong for you if you paid attention.
Ensuring You Visualize the Long Term Effect of Decisions
When you are making financial decisions, you might not be able to outline its effect in the long term. For instance, you might free up some cash today by reducing the amount you put in your pension, but that decision will have a huge impact on your pension in about 30 years. Therefore, employing financial and cash flow planning tools may enable you to see the long-term impact your decisions may have.
It is necessary that you block out the noises that the news may bring to you. Find a financial planner and discuss your financial concerns. That way, you will have more control over your financial decisions, and you will not have to regret them in the long term.