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Do you have a lot of money, but stay up nights worrying it will disappear?

Do you have a lot of money, but stay up nights worrying it will disappear?

August 08, 2023

After working with, and knowing personally so many affluent people over the years, I have come to recognize a common secret among this group — particularly women:

Despite having far more money than the average person in their community, much less the world, they are terrified that it will all disappear. This is such a common issue, that after a 2013 Allianz poll that found that half of middle-class women, and a third of affluent women fear becoming homeless, the fear was deemed “Bag Lady Syndrome” by the media.

Sometimes the fear manifests in other worries — a woman may fear losing her lifestyle, and the social network that comes with it. Perhaps she’s afraid that her children and grandchildren may struggle, or face a perilous future in the face of political, economic or environmental uncertainty.

Consider my client, whom I’ll call Sally, a gorgeous woman in her 70s who married (well) three times, inherited a sizable sum from her parents, and ran her own successful fashion business. Sally enjoys her four homes, frequented often by her four children, a gaggle of grandchildren, and various friends and relatives. Her accounts are impressive. But she constantly frets and loses sleep over it all disappearing tomorrow— not to mention what the world today might be like for her descendants.

When I first met her, Sally told me, “Molly, I know that I have an unusually comfortable life, but there are many nights when I stay up worrying about whether I will have enough through the rest of my life, or if a drop in the market would force me to drastically downsize. And with all the changes in the world, I am more compelled than ever create a safety net for my children and their families. Sometimes I think I am crazy, but I can’t help but worrying.”

This is such a common story, one that speaks to the human relationship with security. Think about it: Since the dawn of humanity, humans have thrived on scarcity. It was literal hunger that drove them to get up in the morning, hunt for food, innovate ways to build homes to protect their families, store food and ward off predators. Excessive comfort is not a natural state for humans — educated modern women being no exception.

Even though I grew up with affluence and I have always been professionally and financially successful, I have a host of my own money hang-ups. I feel so grateful for all the gifts in my life: A strong family, financial comfort, a great education, my health, intelligence. I often to think about my very successful, self-made, Depression era grandparents who taught me so much about serving others, decency and gratitude. Am I living up to my potential? Am I a good steward of my gifts?

If you are prone to anxiety about your money, despite having a lot of it, first rest assured that you are completely normal. I have clients who have hundreds of millions of very secure dollars, very frugal tastes (think: Millionaire Next Door) and still worry about living out of their cars. One woman is worth $20 million, and drives an old Chevy pickup truck, and pursues paid board positions because she is terrified of tapping into her nut. The key to combating this stress is to turn it into action, and make sure that you have taken all necessary precautions to protect what you do have, help make your assets work for you now, and help to secure your future.

One of the big differences between affluent people who are terrified about their financial futures, and those who sleep easy and enjoy their wealth, is a plan. People who have reliable, predictable income streams (and available assets), who have a plan in place for their money and retirement, tend to be those who buy their dream house in Vail, or treat their grandchildren to the dream cruise. Those who withdraw their investments in chunks and live off their assets, tend to be much more anxious about their futures. When these people first come into my office, they are living in what economist Tom Henga calls, “just in case retirement.” When I ask, “Why haven’t you booked that trip to Africa you always dreamed of?” they say: “We are waiting, just in case something happens.” “Something” might be a major market crash, or a long-term-care medical expense. Despite the fact that their portfolio might be able to withstand the stress of these challenges, those without a plan are often beholden to an arbitrary figure (usually in the millions) that they keep in mind, convinced that if that nut dips below their threshold, they will be thrust into financial crisis. Proper planning saves investors from this illogical thinking, and gives them freedom to make decisions based on facts and projections.

With the right financial professional you can feel confident that your life, and that of your children and grandchildren, will be more financially secure and comfortable, and able to withstand the fluctuations of the normal market ebbs and flows. But more importantly, with the right plan in place you can have predictable, reliable and sustainable income plans and not only enjoy live out your dreams, but be much happier day-to-day.