Investment News: The High Cost of Procrastination

One of my former business coaches shared a piece of advice that left a lasting impression on me. It wasn’t just a catchy phrase—it held profound wisdom and a universal truth applicable to many aspects of life. While I can’t recall the exact wording, the essence of the message was something like this: “It’s harder to keep avoiding what you don’t want to do than to just do it.”

This simple but powerful concept can significantly shape our lives, often redirecting us toward better outcomes. At first glance, it seems like common sense, but its implications are deep. Essentially, the avoidance of tasks, especially those that are important or necessary, usually creates more difficulty and stress than simply getting them done.

Let’s break it down with a relatable example:

Imagine you have every intention to go to the gym tomorrow. When tomorrow arrives, though, you find reasons to skip it. Maybe you’re tired, you got sidetracked by work, or perhaps a last-minute errand popped up. By the end of the day, you still haven’t gone to the gym, and now, you’re feeling guilty and irritated. That bad mood may spill over into your interactions with family or friends, further souring your day.

But consider the alternative. If you had just gone to the gym as planned, you’d likely have enjoyed a good workout, felt healthier, and avoided the guilt altogether. You’d return home in a better mood, more energized, and with a sense of accomplishment.

This principle applies to almost every aspect of life, from daily to-do lists to addressing deeper issues, like having difficult conversations with a colleague or tackling a bad habit. It would often be easier and more beneficial to just take action than to procrastinate and deal with the emotional and practical consequences of avoidance.

Financial Planning: Why Taking Action Is Essential

This principle also holds true when it comes to financial planning. Whether it’s creating an estate plan, managing taxes, optimizing your income during retirement, or reviewing your investment portfolio, procrastination can have significant consequences. Avoiding or delaying action in financial matters doesn’t just create mental stress—it can lead to missed opportunities, higher costs, or even long-term financial loss.

For instance, if you continually put off updating your estate plan, there may come a day when it’s too late to make crucial adjustments. Laws can change, or life events may occur that leave your estate in a vulnerable position, exposing your loved ones to unnecessary financial and legal headaches.

Similarly, delaying income planning in retirement can lead to miscalculating how much you’ll need to support your lifestyle, resulting in a financial shortfall when it’s too late to make adjustments. If you ignore tax planning, you could end up paying more than your fair share, impacting your long-term financial health.

Even when it comes to managing investments, waiting too long to adjust your portfolio during a market downturn can result in bigger losses than necessary. When markets are volatile, your ability to adapt and make informed decisions can protect your hard-earned savings from taking too big a hit.

Taking Small, Consistent Steps

The key to avoiding the pitfalls of procrastination in financial planning is to take small, consistent steps rather than trying to tackle everything at once. You don’t need to overhaul your entire financial plan in a single day. Start with manageable actions like reviewing your tax strategies or updating your beneficiaries. Gradual progress is often the most sustainable way to approach complex financial tasks.

Regular reviews of your finances—whether it’s your investment portfolio, estate plan, or tax strategy—can help you stay on track and adjust for any changes in your personal circumstances or the financial landscape.

It’s also essential to work with professionals who can help guide you through the process. Many people delay financial planning because it feels overwhelming or they don’t know where to start. A Certified Financial Planner (CFP) can simplify the process, helping you prioritize your goals and take action in a structured, manageable way.

The Cost of Inaction

Let’s return to the concept of avoidance. When it comes to your finances, the cost of inaction is often far greater than the effort required to make proactive decisions. Take estate planning, for example. If you neglect to create or update your estate plan, your heirs could face lengthy legal battles, excessive taxes, or even lose control of the assets you intended to leave them. A bit of planning today could save your family significant stress and expense in the future.

The same holds true for tax planning. If you delay addressing tax strategies, you could miss out on opportunities to reduce your tax burden, leaving less money for your retirement or future financial goals. By taking proactive steps, you could ensure more of your hard-earned money stays in your pocket, rather than being lost to unnecessary taxes.

When you avoid reviewing your investments, you may miss critical chances to rebalance your portfolio, capture gains, or protect your assets during market volatility. The market is constantly changing, and staying engaged with your investments can help mitigate risk and enhance your long-term returns.

Don’t Wait for the “Perfect” Time

Many people hold off on financial planning because they’re waiting for the “right” time—maybe after a big life change or when they feel more financially secure. But in reality, there’s rarely a perfect time to start. Waiting often means missing out on opportunities that could have made a difference.

The best approach is to start where you are today. Even small actions—like setting up an automatic savings plan, reviewing your insurance coverage, or meeting with a financial planner—can make a meaningful difference over time.

It’s often harder to avoid what you know you need to do than to simply get started. The same rule applies to your financial life. Whether you’re dealing with estate planning, taxes, income projections, or investments, taking action today will likely save you a lot of stress, guilt, and financial hardship down the road. Start now, and you’ll be thanking yourself later.