By Chris Castles
Recently on the ABC’s 7.30 report there was a story about some ‘investors’ who’d put their life savings into the established crypto currency ‘Bitcoin’ through igot, an Australian Bitcoin Exchange. The end result was that the investors were having trouble getting any of their money back and perhaps would lose their life savings.
I look at stories like these and think, ‘What were they thinking?’. Why would you put all of your life savings into a bet. A bet effectively that the value of the Bitcoin would go up. Would you put all of your life savings into the American dollar and hope for the same? Would you put all of your life savings into BHP, CBA, or some other major company and hope for the same? Of course not. That’s not investing, that’s gambling.
So why does this happen. Why do people go for things that look so obviously foolish after the fact? Well, if you’ve read any of my blogs before you’ll know that fear is a bigger motivating factor than almost anything else, and FOMO (fear of missing out syndrome) has a very strong influence on all of us.
Haven’t heard of FOMO before?
Well FOMO isn’t just relevant for investing. Have you ever experienced missing out? You know, on what other people are doing. They’re having fun that you’re not. They’re at the hottest rock concert and you’re not. They’re experiencing the world and you’re not. And this list goes on. That’s FOMO. And of course, in the words of the famous slogan from Nike, most people just ‘DO IT’ so they don’t miss out.
So the next time you’re tempted to do something because you feel like you’re missing out remember, there are few things so important in life, they can’t wait. Take a breath, do something different from whatever you’re doing, and come back to it a day later and see if you feel the same way. You may feel the same, but chances are a pattern interrupt might just have saved you some money, or stopped you from taking a risk you couldn’t afford.
Need help so you’re the one that others have the FOMO over? Give us a call on 1800 283 895 or visit www.zestfinancial.com.au.