For beginners who think 'investing is scary': 5 assumptions to let go of
‘Investing is scary’
It is not strange to feel that way.
Since you are moving your precious money, it is natural to be cautious.
If you hear that there is a possibility of losing money, you will feel anxious.
If you keep encountering words you don’t know,
‘This might be too difficult for me’
is what you think.
However, if you look at that fear a little more carefully,
you will find that anxiety about what might actually happen is mixed with
assumptions you have created within yourself without realizing it, such as ‘I must do it this way’.
For example,
‘If I start investing, I might lose a large amount of money’
‘It’s dangerous unless I understand everything first’
‘If I don’t choose the best investment, I will fail’
‘Once I start, I must continue no matter what happens’
‘I am not suited for investing because I am so scared’
These are such words.
When you look at them one by one,
‘I might have certainly thought that way’
you may feel that way.
When you use the word ‘assumption’,
it can feel a bit unpleasant,
as if you are being told that your way of thinking was wrong.
However, I don’t mean to blame you here.
You don’t know much about investing yet.
You don’t want to fail.
You want to protect your family’s money.
In such a state, you might become rigid in your thinking as you try to avoid danger as much as possible.
Therefore,
instead of dismissing it by saying,
‘Thinking that way is wrong,’
‘Maybe I don’t really have to be so set in my ways,’
try loosening up just a little bit.
That alone can change your sense of distance from investing.
‘Investing is scary’ can be magnified by assumptions
Investing carries the possibility of price drops, and there is no need to move money around without understanding it. Therefore, you cannot dismiss all fear as ‘just an assumption.’ On the other hand, your anxiety may be inflated by imagining that you will ‘surely lose a lot of money’ or that ‘it is dangerous unless you understand everything’ beyond the actual risks. First, let’s try to separate the facts from the premises you have created within yourself.
Imagining yourself losing money before you even start
You haven’t invested yet.
And yet, in your head, you are already losing money.
That kind of thing happens.
Start investing.
After a while, the value drops significantly.
You panic.
Your money decreases.
You regret it, thinking, ‘I shouldn’t have done that.’
You imagine such a future even before you begin.
Especially right after seeing stories of losses on social media or in the news, that image becomes stronger.
Even though nothing has actually happened yet,
‘I might end up like this too’
feels like a very realistic future.
As a result, even considering investing becomes scary.
Of course, the possibility of a price drop in investing cannot be ignored.
However,
‘There is a possibility of a price drop’
and
‘I will surely fail miserably’
are not the same thing.
Check whether these two have become conflated in your mind.
First, let’s look at that.
The less you know, the more dangerous investing itself appears.
When you start researching investing, the number of unfamiliar terms increases all at once.
Systems.
Products.
Asset allocation.
Fees.
Price fluctuations.
Taxes.
Once you look up one thing, you find more unfamiliar terms in its explanation.
You search.
More things you don’t know appear.
Before long,
‘With so many things I don’t understand, is it really okay to move my money?’
you think.
When there are many things you don’t know,
‘investing itself is dangerous’
can start to seem true.
But in reality,
‘what you don’t understand yet’
and
‘everything being dangerous’
It is not the same thing.
If you don’t understand it, you don’t have to force yourself to move forward.
You can check things one by one.
You can also choose not to select things you don’t understand.
There is room to think that way.
Try looking to see if ‘facts’ and ‘misconceptions’ are mixed in with your fear.
Let’s take a moment here,
and bring to mind the things you are afraid of regarding investing.
‘I might lose money’
This is a possibility.
Then,
‘If I invest, I will lose a large amount of money’
what about that?
‘There are things I don’t know’
This might be a fact.
Then,
‘I shouldn’t start unless I know everything’
what about that?
‘Prices can go down’
and,
If the price drops, my choice was a failure
It is a little different.
When you break it down like this,
within your anxiety,
there are things you should actually consider,
and conditions you set too strictly for yourself
that can get mixed together.
It is not about eliminating fear.
It is just,
‘Is this really a fact?’
to check once.
From there, we will look at the five assumptions one by one.
Assumption 1: ‘If I start investing, I might lose a lot of money’
When beginners feel that investing is scary, the image that most easily comes to mind first is that they ‘might lose a lot of money.’ Investing carries the possibility of price drops. There is no need to take that part lightly. However, from the phrase ‘investing,’ are you imagining a future where you move a large amount of money from the start and lose it all at once? Let’s separate the magnitude of the fear from the actions you are actually planning to take.
Has ‘investing’ become synonymous with ‘moving a large amount of money at once’?
When you hear ‘start investing,’
what kind of scene do you imagine?
Hundreds of thousands of yen.
Millions of yen.
Moving all the money you have saved up so far.
And those numbers fluctuate significantly.
If you have that kind of image, it is only natural to be afraid.
Moving all the money you saved for living expenses at once.
If you think that way,
‘It’s not for me’
is what you will think.
However,
‘Thinking about investing’ and,
‘moving a large amount of money from the start’
do not have to be the same thing.
Check your household finances.
Separate the money needed for living expenses.
Think about how much you can afford without strain.
You don’t have to start yet; just organizing that much is fine.
Are you making the word ‘investing’ into a bigger action than necessary in your own mind?
Let’s reconsider that for a moment.
The possibility of a price drop is not the same as losing everything.
Investments have price fluctuations.
Therefore,
‘there is a possibility that the invested money will decrease’
That anxiety cannot be ignored.
However, in a beginner’s mind,
‘the price will drop’
to,
‘something terrible will happen’
can all be connected in an instant.
The numbers drop a little.
They drop even more.
Everything is gone.
Life becomes difficult.
In this way, a future that hasn’t happened yet keeps expanding.
What is important at this time is,
‘it will definitely be okay’
is not to convince yourself of that.
Rather,
what kind of things you put your money into,
how much money you move,
and what kind of risks there are,
is to think about each of these specifically.
‘Because it’s investing, it’s all scary’
Instead of looking at it as one big, overwhelming lump,
look at what you are actually trying to do.
By doing so, the risks you need to consider will become a bit more concrete.
What is important is not finding ‘scary-free products,’ but knowing your own tolerance range.
When you are scared,
you want to search for
‘Is there any investment that is absolutely not scary?’
Something that won’t lose money.
Something that won’t drop in value.
Something that is safe.
You feel that if you find such an answer, you won’t have to worry.
But when thinking about your own anxiety, what is important is
not just ‘what is absolutely safe.’
It is also about
knowing ‘how much I can calmly accept.’
This is what you need to know.
If you worry about your living expenses just because the value dropped a little, the current amount might be too large for you.
If you find yourself checking your balance every day, it might be too much of a mental burden.
Where do you start to feel distressed?
Know that boundary.
Instead of searching for something that doesn’t feel scary, it can be more effective to find ways to manage your own fear.
Misconceptions 2 & 3: ‘I can’t start unless I know everything’ and ‘I’ll fail if I don’t pick the perfect option’
Investment beginners tend to think, ‘I’ll start after I learn more’ or ‘I’ll start after I find the best option.’ Since it’s your hard-earned money, being careful and doing research is necessary. However, if you make understanding everything or finding the single correct answer a prerequisite for starting, you may find that your preparations never end. Try separating the act of increasing your knowledge from the act of reaching a state where you can make a decision.
If you try to understand everything before starting, your preparations will never end.
You research investing.
You come across words you don’t understand.
You look up those words.
New words appear again.
It’s a cycle.
At first,
‘I’ll just learn the basics’
is what you thought.
But the more you know,
‘I might be in danger if I don’t know this too’
is what you think.
You study more.
You’re still anxious.
You research even further.
Before you know it, months have passed.
If that’s happening to you,
‘Once I understand everything’
This condition might be holding you back.
Of course, there is no need to put money into something you don’t understand.
However,
knowing everything about investing and
understanding enough to make a judgment about what you are currently considering
are different things.
Instead of everything,
‘What do I need to know right now to make a decision?’
try narrowing the scope.
Even just doing that makes the end of your studies a little easier to see.
The more you look for the ‘best investment,’ the more you get swayed by information
If you are going to invest, you want to choose something good.
That is a natural feeling.
But,
‘something good’
when it changes to
‘the best thing for everyone’
it becomes difficult.
Looking at rankings.
Look at comparison articles.
Look at social media.
Watch videos.
Some people say A is good.
Others recommend B.
Some people are talking enthusiastically about C.
Even though you thought you’d go with A until yesterday,
‘Maybe B is better after all’
is what you end up thinking.
The next day, you’re interested in C.
The more information you gather, the weaker your own judgment becomes.
You might find yourself in that state.
This isn’t just because you lack knowledge.
‘I have to choose the only correct answer’
might be a condition that is too strict.
What you need is not perfect knowledge, but your own criteria for judgment.
When you see information,
what do you use as a basis for your judgment?
Without that, you will waver every time new information comes in.
Someone says,
When someone says, ‘This is the one right now,’
you get curious.
When someone else says,
‘You should avoid that,’
you feel anxious.
However, if you have even a small sense of your own direction,
‘This might not align with my goals’
is how you can think about it.
That sense of direction doesn’t have to be perfect from the start.
What are you saving money for?
What kind of timeframe are you considering?
How much can you invest without straining your daily life?
Is it something you can understand?
These are the kinds of criteria.
Having a lot of knowledge and
having your own decision-making criteria
are similar, but slightly different.
Precisely because you are a beginner, rather than just increasing the amount of information,
‘What do I value when making decisions?’
Building this up little by little can lead to peace of mind.
Misconception 4: ‘Once I start, I have to keep going no matter what’
The term ‘long-term investment’ makes some people feel that ‘once you start, you have to keep doing the same thing for decades.’ Thinking that way makes that first step feel very heavy. However, precisely because you are thinking long-term, your life and household finances may change during that time. Perhaps ‘continuing’ and ‘never changing your initial rules’ don’t have to be the same thing.
You don’t have to keep investing the same amount even if your life changes
When you started investing, this amount per month was fine.
But you don’t know what will happen in a few years.
Your children’s education expenses might increase.
Your housing costs might change.
You might change jobs.
Your way of working might change.
Your family situation might change.
You might have a series of unexpected expenses.
Even so,
‘I decided on 30,000 yen a month at the start, so it must be 30,000 yen no matter what’
If you think that way, there may come a time when investing puts a strain on your life.
Thinking long-term does not mean
assuming that your life will stay the same for a long time.
If it no longer fits your current household budget, review it.
There is no need to think of that as ‘not being able to continue.’
Adjusting as you go to match your life is part of the process.
That is also a form of continuation.
It is okay to stop and check when you feel anxious
Once you start,
you must not feel anxious.
You must not hesitate.
You must not stop.
Don’t you think so?
When you look into long-term investing,
‘Don’t panic even if prices drop’
is something you often see.
Then,
‘I am bad for feeling anxious’
is what you think.
But when you feel anxious,
what is happening?
Is there any impact on your daily life?
Have you strayed from your initial goal?
Taking a moment to check these things is not a bad thing.
What is important is not to confuse acting impulsively the moment you feel anxious with stopping to check things over.
It is not the same as stopping to check.
‘I’m a little scared, so I’ll organize my thoughts for a moment’
If you have that kind of margin from the start, the feeling that ‘there is no turning back once you start’ will also weaken a little.
Don’t equate ‘continuing’ with ‘pushing yourself too hard’
Because it’s for the future.
Because it’s a long-term investment.
Because there’s no point if I stop here.
While saying that, you are sacrificing quite a bit in your current life.
If that is the case,
‘continuing’
and
‘pushing yourself too hard’
let’s see if they have become the same thing.
Your monthly living expenses are tight.
You cannot handle sudden expenses.
You are sacrificing even necessary things to maintain your investment amount.
Even so,
‘I must continue’
you think.
The more you want to continue for the long term, the more painful it becomes when the strain piles up.
Adjust in order to continue.
If necessary, pause for a while.
It changes its form as your life changes.
When you think of it that way, the word ‘continuity’ becomes a little softer.
Assumption 5: ‘I’m too scared, so I’m not cut out for investing’
Every time I hesitate about investing, I feel that ‘people who can make bolder decisions are better suited for it.’ I’m afraid of price drops. It takes me a long time to decide. I want to check things over and over again. When I see myself like that, I feel like I don’t have the aptitude for it. But that caution might just be the flip side of not wanting to treat your precious money carelessly. Let’s consider a perspective other than ‘fixing my fearful self.’
Being cautious might be because you want to protect your precious money
You can’t make up your mind easily.
You’re worried about price drops.
You can’t put money into things you don’t know.
You might think of yourself as
‘cowardly’.
But, to rephrase it slightly,
you could also say that
you are thinking carefully because it is your precious money.
That is also true.
Especially if you have a family.
You want to protect your livelihood.
You want to cherish the money for your children.
You don’t want to cause trouble with your own decisions.
Because you have those feelings, you can’t decide easily.
Of course, it can be painful if you become too cautious and can’t make any decisions at all.
However, you don’t need to get rid of all your caution.
You can turn that caution into
‘What do I need to confirm to feel convinced?’
a standard you can use.
Instead of trying to eliminate fear, think about ‘what would make me feel convinced’
If you are looking for
‘ways to stop being afraid of investing,’
as long as the fear remains,
you will feel that ‘you are not yet ready to start.’
But,
try changing the question to
‘What would I be convinced by?’
Don’t touch the money you need for daily life.
Don’t invest in things you don’t understand.
Think within a range you can handle.
If you lose sight of your purpose, go back to the start.
If you have conditions like these,
you might be able to think about it even if your fear isn’t zero.
Instead of trying to eliminate fear before making a decision,
create conditions that make it easier for you to decide, even with your fear.
That is a way to avoid leaving your own feelings behind.
Think about investing from your own goals, rather than fitting yourself to investing.
When you gather information about investing,
‘You should do this’
starts to increase.
Faster.
More efficiently.
Longer.
More.
As you encounter such words,
you may start to feel like you have to fit yourself into the ‘correct’ way to invest.
But, in reality, it might be the other way around.
What do you want to prepare money for?
What kind of lifestyle do you want to protect?
How much anxiety can you handle?
Those goals and conditions come first.
Based on that,
‘What kind of mindset suits me?’
is how you look at investing.
Instead of fitting yourself to investing,
Consider whether there is a place for investing in your life and household finances.
By doing so,
“I have to become someone suited for investing”
you will be able to distance yourself a little from the pressure of that thought.
Once you have let go of these misconceptions one by one, what might remain at the end is the question, “So, what am I investing for?”
It is not because everyone else is doing it, nor because you were told that “you will lose out if you don’t invest,” but rather, what do you want to do with your money in the future?
When that purpose becomes a little clearer, it becomes easier to return to your own standards when choosing information or when you feel anxious.
If you want to organize the very meaning of starting to invest, please think about long-term asset formation for yourself in Article 11, “Long-term investment concepts and goal setting you should know before you start investing.”
Letting go of misconceptions allows you to think calmly about whether or not to invest
Just because you have reviewed your misconceptions does not mean all your anxiety about investing will disappear. The possibility of price drops and the unknown will remain. Even so, when one condition of “I must do this” is removed, you may be able to think about whether to invest more calmly than before. Finally, let’s practice rephrasing your misconceptions slightly instead of forcibly denying them.
The goal is not to make fear zero
“Investing is scary”
It is fine if that feeling remains.
You haven’t understood everything about investing either.
If you imagine a price drop, you still feel a bit uncomfortable.
If it is family money, you will naturally be cautious.
There is no need to get rid of all those feelings and
“Investing is not scary at all”
become able to think that way.
Rather, because there is fear,
Check things you don’t understand.
Separate the money you need for daily life.
Avoid investing amounts you can’t afford.
Think it over once.
It can sometimes lead to that kind of behavior.
What we want to aim for is,
not a state of zero fear,
but a state where you don’t have to let fear decide everything
perhaps.
Just asking yourself ‘Is that really true?’ can change your distance from anxiety.
Even if you want to let go of an assumption,
you don’t have to start believing the opposite today.
For example,
if you thought,
‘I can’t start unless I know the details,’
try asking,
‘Do I really need to know everything in detail?’
If you think,
‘I absolutely must keep going,’
ask, ‘Do I have to stay the same even if my life changes?’
I hear.
‘I’m not cut out for this because I’m scared’
If you think that,
‘Aren’t there rules you can decide precisely because you are cautious?’
I ask.
You don’t have to force yourself to come up with an answer.
For the way of thinking you took for granted until now,
‘Is that really true?’
Create a small gap.
Just by doing that, you can create a little distance between your misconceptions and yourself.
You can decide to take a step after finding conditions you are comfortable with
Should you invest?
Or is it better not to yet?
It is okay not to rush to decide that answer in this article.
First,
what were you assuming?
Which misconception was making you suffer the most?
Find that.
And then,
‘So, how can I think about this in a way that makes more sense to me now?’
Try changing the words you use.
‘I have to know everything’
to,
‘I only need to know what is necessary for me to make a decision’
.
‘Once I start, I can never stop’
to,
‘I can review it if my life situation changes’
.
‘I’m scared, so I’m not cut out for this’
to,
‘I should figure out what conditions make me feel secure before I decide’
.
Just changing your words a little bit can make a difference.
Even so, when you think about your next steps based on those words, the way you make choices will change.
You might still be scared.
You might still be hesitant.
But,
‘I’m scared, so I can’t do it’
, other options besides that conclusion will start to come into view.
I think that even that level of change is enough for now.
Did you find anything among these five that made you think, ‘I might have thought that too’?
If you did, please try writing down just one of those assumptions in a notebook or on your smartphone.
Then, write just one more line below it:
‘Is that really true?’
try writing that.
If it’s ‘I must learn everything before I start,’ then,
‘Maybe I only need to know what’s necessary for making decisions, rather than everything.’
If it’s ‘Once I start, I must keep going,’ then,
‘Maybe it’s okay to review it according to my lifestyle.’
Try rephrasing your previous way of thinking just a little bit like that.
In the Anshin Asset Lab’s ‘Guide to First-Time Long-Term Asset Formation,’ we also make it possible for you to write down your own assumptions and anxieties and organize them to replace them with different perspectives.
There is no need to force yourself to get rid of the fear of investing.
Before deciding ‘I can’t do it because I’m scared,’ try to verify what kind of assumptions are hidden within that fear.
From there, please try to find choices that you can feel comfortable with, little by little.
I have started an official LINE account to reduce investment anxiety.
‘I want to start investing, but I’m afraid of losing money.’
‘The more I look into the new NISA, the more confused I get.’
I have started an official LINE account for people like you.
On the official LINE account, I will deliver information such as how to think about investment amounts that won’t make your life difficult, criteria for making decisions without being swayed by information, and rules for not panicking when the market drops.
The important thing is not to copy someone else’s answer, but to decide for yourself what is ‘safe enough’ based on your own household finances.
Let’s think together about how to continue building assets without strain while protecting your current lifestyle.
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