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Financial Understanding + Responsibility Yields Independence


Finance and Fury will be focusing on helping you define your aims, and increase your knowledge and ability so you can make the best financial choices.

May 14, 2017

Achieve your goals and overcome the fear of failure!

To do anything new can be scary due to the unknown. Our brains paint a dramatic picture of possible outcomes and we psych ourselves out from ever pursuing these goals. This mental picture can create anxiety due to the fear of failing so we remain in our comfort zones and never try.

This type of fear is something that effects a lot of people, I know I used to be one. When I first started working in financial services even calling a superannuation fund to get clients information caused a bit of anxiety in me, god forbid calling a client to discuss their personal situation. Over time I learnt how to get rid of fear and with it, the fear of failing.  

The irony of this situation is that you are guaranteed to fail if fear stops you from ever trying! This in conjunction with procrastinating (which we will cover later) are the biggest causes of not reaching your goals.

What is fear?

Fear is a vital response to physical and emotional danger. This response has led us to protect ourselves from legitimate threats to survive. Fear causes a physical change in metabolic and organ functions and ultimately, changes your behaviour. Anyone heard of the fight or flight response before?

Early humans who were the quickest to fear dangerous situations were more likely to survive and reproduce. From this a theory called preparedness emerged where through natural selection, modern humans have developed a heightened sense of fear. Our heightened sense of fear created another element to add to fight or flight, which is freeze. This is now known as the fight, flight or freeze response.

In society today, we rarely (if ever) face a situation that is life or death. There aren’t many terror birds or sabretooth tigers running around. When we think about trying something new there is normally no immediate danger to us, so we have no need to fight or take flight, so we freeze.

Major Fears can be broken down in to two categories:

  • Physical – Flying, heights, death, spiders, etc.
  • Emotional – public speaking, failure, commitment, criticism, poverty, etc.

These can be broken down further into Rational or Irrational fears. To give an example, I am not petrified by snakes, but I almost stood on a red belly black snake one day and boy did the flight response kick in. This can be a perfectly rational response to this situation. However, fearing to go outside for the possibility of running in to another snake would be an irrational fear.

Fearing failure is another irrational fear as the outcome of what we are afraid of is totally unknown. However, we are still hardwired to respond to fear which we will avoid at any cost, so we do nothing.

The funny thing with this type of fear is that it is entirely self-created. The term Fantasied Experience Appearing Real (F.E.A.R) has also been coined when describing irrational fears. We automatically think that we will fail in the worst possible way and of course, fear this outcome enough to never try.

Failure is a good thing. I know it may not seem like it, but treat it as a learning curve and failing can become your best friend. It may seem like a dirty secret, but everyone fails. Most people just don’t like to talk about their failures.  

I have failed plenty of times at many things and no doubt, will fail many times in the future. The first time I spoke to an audience of 50 people I was really nervous, you could even call it fearful. Because I was so nervous, I spoke to quickly and forgot some points I wanted to go over. It was ironic that in this experience, fearing the worse lead to a worse outcome than if I was completely calm. Nothing bad happened, expect when I expected it to. Instead of fearing the worst, treat every failure a great opportunity to grow.

As an infant, you didn’t just jump up and run a marathon when learning to walk. You fell down a lot, but kept getting back up and eventually learnt to walk. Now you do it without even thinking. This same principle can be applied to anything!

This occurs when investing as well. I made plenty of errors in my early days of investing and rather than never investing again, I just learned from the experience and became a better investor out of the process.

A great example of the best attitude towards failure comes from Thomas Edison. He made 1,000 unsuccessful attempts when he was trying to invent the light bulb. When asked, "How did it feel to fail 1,000 times?" Edison replied, "I didn’t fail 1,000 times. The light bulb was an invention with 1,000 steps."

So how do you avoid this fear?

Our minds tend to paint the worst-case scenario when it comes to failure, but this is completely in your own mind and we are incredibly creative when it comes to this. Successful people have fear, they just don’t let it control them. So, what are you worried about?

Step 1) The first step is to review your goals and action plans from last episode. If there are any immediate fears that spring to mind, then write these down. If your goal is to start investing, then you may fear losing money. This step is important as it allows you to take a personal inventory to see what type of fear you have. If you are fearful of an outcome that has no guarantee of occurring then just remember, this is irrational!

Step 2) Go through each fear and discount them. This step comes back to changing your mindset.

The first question you should ask yourself is: What is irrational about this fear? If there is no guarantee of it occurring, then tell yourself “this is irrational”. From here, take the ‘so what’ approach. If you are afraid of calling someone to propose a business deal and they say no, so what? You are left no worse off. The same is true when it comes to investing. If you are invested in quality assets, then how will you lose money? If you buy a basket of investments (like the ASX300), the only way you can lose all of your money is if all 300 companies in the index go out of business or if you sell when the investment has lost capital value (which by the way, will occur at some point!).

Step 3) Focus on the outcome - Imagine how happy you would be if you had achieved your goal. If it is really a goal you want to achieve, this outcome should provide enough inspiration to overcome your fears. This allows you to focus on the pros and cons of the situation (your fears are cons, versus the outcome which is your pro).

Step 4) Just do it! This last step focuses on taking the first step towards your goal, regardless of if you are afraid or not. I have found that the best way to overcome any fear is to expose ourselves to our personal demons and through doing so, move past them. Fears are good, they show you that you are moving in the right direction. Anything outside of your comfort zone is normally feared, but through tackling these you will grow as an individual.

Time is fears biggest alley. The more time you spend thinking about what may happen, the less likely you are to try.

You can’t remove fear completely. There will always be something new to be afraid to try. But you can change what you are afraid of. Through applying these steps to my own life, I only have one fear now. Waking up one day and I am 50 years old, having achieved nothing that I set out to do with my life. This is what causes a mid-life crisis; failing to meet the goals you have, through fearing failure.

I learnt this from studying many self-made individuals. A large majority of these people have been broke, or immigrants who move to a country with nothing. What I saw it that their fear of being poor was greater than the fear of failing. This is where staying in your comfort zone can be the biggest killer of success.

Failures will happen, they are a part of life. However, through facing adversity and failures, we grow and appreciate our success more! If you have ever played a video game on ‘GOD MODE’, you end up getting pretty bored and it is not fulfilling.  This is what I have found, anyway. The same can be applied in the real world.

Getting over your fear of failure allows you to take actions but there will be obstacles in your way, you have to come to terms with this. Just remember to stick to the action plan you have created from your goals.

How to overcome obstacles?

When something like an obstacle occurs, there will always be a solution. Make 3 different strategies to solve this and if they don’t work, try three more! It is always too soon to give up – just keep going and don’t let anything stand in your way. It took Thomas Edison 1,000 attempts to invent the light bulb. There is a solution to everything, we just have to find it! As the saying goes “Success is only one failure away!”.

To conclude, failure is not the enemy, your fear of failure is!

Just remember if these fears are self-create, you can get rid of them.