“Fear is a reaction in our mind. Danger is real.” At this point in my evolution, I’m rarely floored by such a simple statement. But when I heard this concept voiced out loud the other day, I had such an ‘Aha!’ moment that it sent my head spinning. After all, if fear feels so real, how could it not be? Fear is a powerful response! It can push us to make poor decisions with poor outcomes. In the worst-case scenarios, our reaction to the feeling of fear can put us toward real danger.
Is your head spinning yet?
As I tried to wrap my arms around the idea, I turned (as always) to the wonderful world of Google. In one of the articles I found on the topic, Telling the Difference between Danger and Fear from The Atlantic, the author cites that, “on average, one American dies each day in a bathtub accident—and one American dies each year from a shark attack.” It begs the question: why are we much more fearful of sharks than taking a nice, long soak in the tub? Why are we more scared of flying in a plane than getting behind the wheel of a car—something that should strike real fear into every Southern Californian? (Right, Tiger?)
The short answer is that we’re more comfortable in familiar situations than we are in those that are unfamiliar to us. The same is true for sensations and risks we experience every day. We’re comfortable, so we mute the fear response.
In my role as a financial advisor, I see this play out in real life much too often. When we enter a period of extreme volatility in the stock market, I see clients struggle to manage their fear of the financial unknown. “If the market goes down,” they think, “my worst fears could come true!” They imagine themselves in danger of being out of money, out of their home, and friendless. Homelessness and isolation are real dangers—for those without a financial plan. For all of my clients, their plan provides a margin of safety so that those fears are just feelings. There is no real danger. Even when I offer facts—the inevitability of market cycles, the persistence of growth, and the power of compound interest—the feelings persist. Some find the feeling unbearable and shift their investments into the “safety” of cash anyway—a move that I know may put their financial security in very real danger.
Bathtubs and sharks. If only we could easily see where the real danger lies, life would be so much simpler! But let’s face it: we’re human. The fear response is triggered in our amygdala. It’s nature’s way of sharpening our senses when we encounter a perceived threat. Our natural ‘fight or flight’ response is necessary to keep us out of harm’s way.
Except when it causes us to do the opposite.
To keep fear from ruling our world, the first step is to recognize the difference between fear and danger. Humans, unlike animals, can create a space between a stimulus and our response. When you feel fear, take a breath. Acknowledge the feeling. Take another breath. Ask yourself, what is the danger? Is it real? If it is, refocus your time and energy on addressing the real danger. It may be the only way to outrun your DNA and make wise decisions that lead to better outcomes.
- If you fear investment risk, consider the danger of not investing and diminishing purchasing power.
- If you fear becoming a bag lady, focus on the danger of overspending and not saving today.
- If you fear swimming with sharks, focus on the danger of the bathtub.
Of course, I’m joking on that last point, but it does a great job illustrating how the feeling of fear can blind us to real dangers. To bring this closer to home, try this quick exercise. Make a list of five things you fear. Divorce, death, job loss, disability, whatever strikes that feeling in your heart. Next to each fear, write down the danger you associate with that fear. Now think: is the danger real? If yes, then what is a strategy to help minimize the danger?
I have always had an irrational fear of heights. That fear has kept me from enjoying gorgeous views from mountaintops, experiencing lovely scenic drives, and taking in the view from the top of the Empire State Building. It is a minor inconvenience, and I can make believe I’m brave. Years ago, I lived in constant fear of being fired from a job and dreaded the real danger of becoming financially fragile. When I was finally let go, I had accumulated a nice little nest egg that kept the danger at bay. I suffered because of my fear but faced the danger head-on.
Fear isn’t real, but the feeling of fear is. To move past it, we need to acknowledge the feeling, identify the potential danger, and put a strategy in place to stay safe. If we can accomplish that, I truly believe that the sky is our only limit.