Clay Jarvis
Beth Buczynski
This is a story about investing. But it’s also a story about fear, and my attempt to conquer it.
Since I was a kid, the future has always felt vaguely, if not acutely, terrifying. My parents divorced when I was six and my sister passed away when I was nine.
When you’re exposed to shocks like that at a fragile age, it tilts your world’s axis. Its light dims and the belief that what’s good today will still be there tomorrow struggles to take root.
But cynicism, pessimism and procrastination? They’ve been in constant bloom. If doubt were tulips my mind would be Holland.
I’m 47 now, so I’ve spent roughly four decades scanning the horizon for smoke, assuming the next disaster — a job loss, a breakup, a sick parent — is on its way. I’ve delayed many life decisions because I was afraid that something would come out of nowhere to stomp my plans to dust.
That’s why I, a personal finance journalist, didn’t start investing until I was 45 years old.
That kind of dallying might sound foolish — or familiar. If you’re in the same boat I was, let me tell you how I grabbed the oars and changed course.
I got off the sidelines
In November 2022, the in-house financial advisor at my local RBC branch reached out, wondering if I’d be interested in doing something more with my savings.
At that point, everything I’d been able to set aside since paying off my student loans — about $80,000 — was sitting in a high-interest savings account.
I passed on meeting him. I felt ready for any financial shocks the world had in store.
But my work at NerdWallet meant ingesting a steady dose of financial statistics and news alerts, an alarming number of which concerned the retirement worries plaguing Canadians.
I eventually developed a whole new anxiety around my own retirement. If all I did was save, I’d be screwed.
The beauty of this particular fear — more visceral and tangible than what I’d been used to feeling — is that it woke me up.
Even with a decent income and rigid spending habits, I would never squirrel enough away to retire. I needed to play catch up, and the quickest way to do that was to tap the capital I had on hand and put it to work in the stock market.
I funded my TFSA and RRSP in April of 2023, and saw positive results soon after: minor gains for my RRSP holdings; substantial leaps for several of my TFSA picks.
I felt a mix of emotions I’d never really experienced before: relief that I made the right decision, regret for my years of inaction, pride about overriding my fear. And yeah, a little greed. All of these emotions helped me lean further into investing.
I also came to a realization that I hope more people tap into: Past a certain point, obsessively saving money will hold you back. One of the few benefits of living in a capitalist society is that your money can work for you. But only if you accept a little risk.
For me, the risk of losing a little money when the market dips pales in comparison to the risk of having to share my cats’ food when I retire.
I pictured what could go right
I’ve often wondered why I let my fear override all the quantitative evidence that shows investing often pays off in the long run. Turns out it’s not an uncommon mental predicament to be in.
“Behavioral research calls this the risk-as-feelings hypothesis,” Chi Liao, an associate professor at the University of Winnipeg’s I.H. Asper School of Business, told me by email.
“Our emotional reactions to risk and uncertainty often differ from, and can outweigh, our rational assessments …. So even if the data shows that investing over 10 years is very likely to yield strong returns, fear of risk/uncertainty can still hold us back. This is why someone may fear flying even though they know that airplane crashes are extremely rare,” Liao said.
Procrastinating can feel like it protects you. But delaying beneficial financial moves, even if they involve uncertainty, could be damaging to your future self.
“Try picturing who that person is and what they might want … Investing today helps that person get there, and research shows that feeling more connected to your future self makes you more likely to do what it takes to reach those goals,” Liao said.
I started slow — and low risk
Note: I’m not a licensed financial advisor, so the following information is not to be taken as investing advice of any kind.
My investing has been somewhat conservative so far. My RBC RRSP is a low-risk mix of bonds and equities that I let the bank take care of for me. I automatically contribute to it twice a month and barely even think about it. In the last year it’s up 16.43%.
My TFSA started out with several low-risk bets — some Big Six bank stocks and an ETF that tracks the S&P. Once I felt a little more confident, I bought shares in a few major U.S. tech companies and some recognizable Canadian firms that offer growth potential and dividends. That’s about it. My portfolio’s up 21% in the last 12 months.
If the idea of picking stocks sounds daunting, Liao suggests taking a simpler approach.
“Investing is one area where less is more,” she said, adding that her preferred method is “couch potato investing.” She invests in a single, low-fee, index-tracking ETF that provides exposure to Canadian, U.S. and international stocks.
“Invest a set amount each paycheck and leave it alone until retirement. Don’t react to market swings or the news, don’t try to time the market, don’t even look at your account.”
I don’t think the gains I’ve seen have anything to do with my ability as a stock picker. They’re just the result of a suspiciously hot market. Once it cools, I’ll be right back to worrying about what’s coming next.
But when that day comes, I’ll be a little more experienced and a lot more confident than I was before I convinced myself to start investing. Even if my portfolio (or the world) blows up in my face, my future self knows I tried to do the right thing for him.
About the Author
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