Coping With The Fear Of Investing

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[This post is brought to you by Patrick Weinert, who knows how fear and uncertainty can disrupt even the most logical investing plan.
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I’m Patrick Weinert, a retired Marine Corps Lieutenant Colonel, and I help active and veteran service members with their personal finances. I want to thank Doug for giving me the opportunity to provide a guest posting.

One of the most valuable lessons I learned during my career as a Marine was personal emotional stability.

Image of concrete plaza with yellow footprints, lit up at night, with a Marine drill sergeant ready to greet new recruits from the buses in the parking lot. |

“Marines start here.”

When I first went to Officer Candidate School in the summer of 1996, I was the most scared candidate on that white bus as it rolled through the front gate of Marine Corps Base Quantico, Virginia. Although our group would not be confronted by drill instructors for a couple days, within that time the mere anticipation of the coming storm was enough to shake me.

Just before all hell broke loose, I was given the opportunity to call home. I had gone through a lot of physical and mental preparation to get to where I was. I had been accepted as an officer candidate. What an honor. Yet still I felt the fear.

I called my father and said “Dad, maybe this isn’t for me. I know I’ve done a lot of preparation for this, but maybe I should just head back home.”

My father took his time patiently listening. Then he said in a calm voice: “Come on Pat. Just be a man.”


That was a very pivotal point in my life. And my father’s timely and prudent intervention made a huge difference. As a result, I was able to build a career over many years that taught me some great lessons, helped me form some great relationships, and enabled me to learn from some great leaders. It also gave me the opportunity to learn about the importance of personal emotional stability.

Sometimes, the mere fear of something can be a more powerful motivator than the actual thing feared.

Getting yelled at by drill instructors during Officer Candidate School was one thing. But the anticipation of it was worse!

Investing has many similar qualities. How do I know if I’m saving enough money? How do I know if I’m putting it in the right exchange traded fund? What happens if there’s a stock market crash? What happens if I lose my job?

After the 2008 financial crisis, many people’s lives changed in dramatic ways. Some lost their jobs and had to do complete career changes. Some kept their jobs but they were required to relocate, or adjust their lifestyles to get their finances under control. And some didn’t even have to change their job or lifestyle, but their experience and new fear with investing made them sell everything (at a loss) and get out of the investing business altogether.

Don’t let fear paralyze you.

Over 99 percent of everything we worry about never happens. And the same goes for investing.


Image of man in a business suit walking a tightrope high above a city-- and losing his balance. |

If your mutual fund investment increases in value, you are tempted to buy more, right? If your mutual fund investment decreases in value, you want to sell it so the value doesn’t fall even more, correct? It’s okay to feel that way. Those are natural human tendencies. Maximizing pleasure and avoiding pain are normal motivations in each of us that are designed for our survival. But they can also be very irrational. You must realize that all of that exists in your own mind. Maintaining your emotional stability is critical to your winning the long term game of investing. Even when the value of your investments is low for many years, you must maintain your emotional stability and stay in the game. In fact, during times like these, you need to be buying more, not less. This is a very simple concept (buy low, sell high), but very difficult for many people to put into practice.

Let’s say you put $5,000 of your hard earned money into the Thrift Savings Plan (TSP) C fund. You plan to have that increase in value over a few years. You are excited about how your wealth will grow. But then there is a stock market crash, and your $5,000 becomes worth $1,200. Are you going to want to buy more of that fund? Of course not. You learned your lesson. Those investment advisers lied to you when they said your money would grow. You are going to get out of the investing game altogether because it’s just too painful.

But this is contrary to what you actually want to be doing – saving more. Why did the price of your investment fall? In most cases, no one knows and it can’t be rationally explained. Maybe someone had to sell their shares because they had an unexpected expense. Maybe someone sold because they saw a different investment opportunity and needed to raise money. If there is nothing fundamentally wrong with the stocks you are invested in, a lower price is actually a gift to you. Now you can buy even more and realize even greater returns in the future.

Probably the greatest challenge to investing is emotional stability. And the most interesting aspect about this, is that it is all internal to you. That is the primary reason that people have financial advisers. They will tell you to do the right thing even when you don’t feel like doing it. If you are able to act contrary to what your feelings dictate – another word for “courage” – that will be rocket fuel for your investing success.

You can find some good techniques for improving your emotions here.

This month, Congress has finalized sweeping tax reform. This is designed to give American citizens, including service members and veterans, a tax break so they can get out of debt and build their savings. If you haven’t made the commitment already, now is a perfect time for a new year’s resolution to save and invest more. But, remember you will need to maintain your emotional stability to do this.

And if you want to take your investing success to the next level, please take a look at my website and subscribe to my free newsletter.

Also, in the next month, I’m going to be releasing two new books. One is on the new blended retirement system. The second is on the benefits of military medicine, and how to use these to save and build toward your financial goals.

If you’d like to receive complimentary copies of these books before the official launch, register here.

Until we talk again, I wish you unlimited success!





WHAT I DO: I help you reach financial independence. For free. I retired in 2002 after 20 years in the Navy's submarine force. I wrote "The Military Guide to Financial Independence and Retirement" to share the stories of over 50 other financially independent servicemembers, veterans, and families. All of my writing revenue is donated to military-friendly charities.

  1. In the 8 trillion or so investment management industry in the US, there are more or less two polarities. One says the average person needs a certain degree of advice or a layer of professional management for a certain price, (Amerirpise, Fidelity) work on this model. At the other end are the TD Ameritrade or Vanguard model which stresses more personal responsibility or autonomy in daily financial advice or management. But all carry a degree of price sensitivity for their services. Vanguard does offer a certain amount of counsel on balances as little as 50K, though the real person to person interactions really start about the 500K or so level under management.

    So where does a 20, 25 year old Sailor go for professional advice or counsel on how to invest his/her 50-70K in their TSPs? Good question and at what price does that counsel come at? Good question again. But I think that as the whole BRS gets rolling and gathers momentum you will have a army of CFPs and those attached to the industry seek access to your local base or post. Or pop up right outside the front gates.

    • Peter, I think you’re also describing the financial counseling available at military bases and the lifetime employment for personal-finance bloggers.

      Another way to look at the question would be where civilian corporate employees get their professional advice and financial counseling. I doubt that most companies do more than offering a video about their 401(k) benefits. Maybe DoD’s financial-responsibility counseling to its military servicemembers, as rudimentary and flawed as it may be, is better than most corporate programs.

    Comment? Question? What's on your mind?