Financial planning is essential to future stability, but obsessing over net worth on a regular basis can cause more harm than good. Too much time spent over the books can reduce your quality of life, mar relationships, and even impact your ability to build wealth.
Don’t Check Net Worth Too Often
Obsessing over net worth is like obsessing over weight loss. Most experts tell dieters not to develop a daily scale habit – pounds rise and fall slightly every day, and it’s long-term progress that really matters. The same is true of wealth.
Checking your status every day or week is likely to breed discontent or discomfort; your investments may drop slightly—or even by a large margin—in one week, only to rise steadily for the rest of the year. Obsessing over net worth on a regular basis could cause depression or anxiety. Even worse, it might cause you to change tactics frequently in the hope of immediate gratification. Unfortunately, the result of impulse changes to investment strategy is usually less than desirable.
Concentrate on Making Good Decisions Daily
In most cases, grand decisions don’t suddenly impact net worth. Instead, developing good financial habits leads to growth over time. Instead of obsessing over net worth, look to your spending, saving, and other financial habits. Work with experts to develop financial plans that grow your wealth over time, then step away and let the seeds you planted work quietly toward the harvest.
Understand that Money Isn’t Everything
While your financial seeds are growing, concentrate on other things in your life, including your career, relationships, and personal satisfaction. Even if obsessing over your net worth leads to a comfortable retirement, will you enjoy it if you’ve lost all other positive aspects in your life? For most people, the answer is no.
Since finances do matter, you can incorporate some thought about net worth into other areas of your life without obsessing. Choose your career and occupation wisely: look for work that you enjoy and can perform in good conscience that also lets you meet financial goals. Make your partner a cohort in wealth building, but don’t forget to set aside money for activities that build relationship and refresh your soul. Do spend money on a vacation, for example, but make sure the budget is reasonable when compared to your overall financial status and future goals.
Do Know Your Value and Plan for the Future
Not obsessing over net worth doesn’t mean you shouldn’t be informed about your financial status or concerned about your future. You can calculate your net worth now to get an idea of what retirement may hold when it comes to money matters. Stay on top of things without getting obsessive by checking your net worth on a monthly or quarterly basis and reviewing investment and retirement statements when they arrive. Speaking with an expert financial advisor can take some of the planning burden off your shoulders, allowing you to enjoy life as your money grows.