FOMO – What is it? And why you need to fight it

FOMO in all aspects of life could be destroying your mental health while providing zero benefits. 

FOMO is the Fear of Missing Out. It exists in all aspects of human life and is magnified in the financial sector. You see and hear it all of the time. People that want to quickly get in on a new fad or a new profitable company while it's still on the way up. We have recently lived through this experience so that you didn't have to... Enter the meme stock craze! 

So many of us desperately want to pick a winner in life. You see it all of the time. I think immediately to sports. Whether it is bandwagon fans or coaches that change their entire playbook every year hoping to get lucky and pick a winner. This fear of missing out is detrimental to our health. Rather than looking forward we spend all of this time looking backwards at all of the things that could've been, "If I had only bought amazon stock 10 years ago it would be worth 18x that value now!"..."If only I had gotten into this housing market a little early I could've made a fortune reselling this house." Here is what that kind of thinking is doing to your brain

Coincidentally, I just returned from Las Vegas, which is the perfect lead-off for the fear of missing out. We so desperately want to pick a winner that we are convinced just one more hand, one more pic, one more stock and we'll hit it big. This just isn't the case. Casinos capitalize on this phenomenon in our brains. We know going in that the house always wins but we are convinced that it'll be different for us. Not a black jack player? Replace that with lotteries and scratch offs, same principle, we know what the odds are but we convince ourselves that we may be different. Someone is going to win it, it could be me! Or, you can't win if you don't play! We've heard these before, they are clever sayings that feed into our fears of missing out. 

Fear of missing out isn't just confined to sports and gambling however. I heard it from my father just the other day. My father is definitely one of THE MOST financially conservative people I know (I feel like that's a lot of dads out there) yet here he was clearly worried about missing out on big earnings. What earnings was he talking about? He was talking about getting in on this current housing market. 

What to do instead? - Stay the course. Responsible investing isn't sexy. It's spending less money than you earn month in and month out and investing the difference into reliable index funds. If you are looking for get rich quick ideas, this isn't the site for you. And if you have the time, effort and skill to try your hand at day trading then you probably aren't looking at teaching and most of our information isn't for you. 

Don't believe in slow and steady wins the race investing? Just look at the professor's quarterly reports, check out the growth from one year to the next. Slow and steady wins the financial race almost every single time. So that's where you should always put your serious money. You can still partake in the speculative side of the market, just put less money there. I've always treated those speculative pics like gambling money. I have to personal be okay if I lose all of that money. That's why most of my speculative pics (AMC and GME) I've only put a couple of hundred dollars into. Extra money that I had in my budget but enough investment that I feel like I am part of the craze. 

Stay the course and KEEP STACKIN!