The Dangers of Financial Vagueness

Financial Vagueness Syndrome (FVS) is a key stumbling block to financial comfort. If you do not know what is going on with your money, it is difficult to plan, strategize, and make rational financial decisions.

If you have been listening to the gloomy financial news, then you probably know that one of the main reasons the system is falling apart is that no one really understands the sophisticated financial instruments such as mortgage back securities and credit default swaps that were being traded in the markets.

Recently we learned that when billions of dollars of TARF funds were distributed, no one kept track of where the money went and what it was used for.

On top of that, no one was watching the store. When the SEC was warned about Bernard Madoff's Ponzi scheme, for example, the warnings were ignored. No one really wanted to know what was going on.

You could easily conclude that Financial Vagueness Syndrome played a significant role in the global financial crisis. Has it played a role in yours?

Bounced checks, late fees, over-limit penalties, and unopened bills are all signs of financial vagueness. If you have ever said, "I do not know where my money goes," you have FVS.

If you do not keep track of your spending and earning (and checking your balance online does not qualify as keeping track), if you never reconcile your checking or credit card accounts, and if you avoid looking at bank and credit card statements, you have FVS.

Getting over FVS provides many opportunities for growth and development. When you pay attention to how you feel about your cash flow, bills, and financial behaviors, you can discover the feelings that serve as the impetus for creating your life stories. This is a key to turning your finances in a new direction



Source by Joan Sotkin


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