From the October 2006 issue of Investment Advisor • Subscribe!

October 1, 2006

Nothing but Fear Itself

Who needs to read Stephen King to be scared?

With the world bedeviled by random acts of terror, it's ironic to be approaching a time of year when we normally look forward to being scared. Halloween ghoulies and ghosts aside, there's a lot to learn from people's attitudes toward what truly frightens them. Whether fear is thrilling and energizing, or paralyzes a person with nameless dread, can depend not only on its cause and intensity but also on that individual's own personality (and perhaps his or her gender).

When clients are grappling with fears that exceed their tolerance level, you may be able to help them calm down and deal with their hobgoblins in a more rational way. Here, for example, are ideas on how to handle a number of scary situations.

Q: My newly retired client planned to travel extensively in Europe and Asia. But after the experience of a friend who was in the U.K. when the bombs-on-planes plot was foiled, she is now terrified to set foot on a transatlantic flight. She also dreads taking buses and subways in New York, where her children live. She has even asked me how much cash to hide in her house in case of a terrorist attack. This lady needs help, but where do I begin?

A: First, it's important to know that there are different levels of fear. The most intense is panic, where people freeze and become incapable of taking rational action. They stop breathing normally and their cognitive thinking processes begin to shut down.

A less extreme level of fear generates the fight-or-flight response we have all experienced. We either run away from the source of our fear, or find the courage to confront it and hopefully to vanquish it.

A third level of fear results in butterflies in the stomach. Unlike the other two, this can feel like almost pleasurable anticipation, such as when you are waiting to accept an award or are a public speaker about to address an audience.

In your case, your client is caught between paralyzing panic and a desire to flee. Give her a sympathetic ear to express her fears. As you listen, encourage her to consciously take deeper, slower breaths. This kind of breathing leads to physical and emotional relaxation.

Once you have helped her get more in touch with her body and a fuller range of thoughts and feelings, she may be willing to reconsider more calmly her fear of traveling. Discuss with her the things that will be under her control, such as where she goes and how she spends her time.

You may also be able to guide her in revisiting other times in her life when she was intensely afraid. Did she succeed in mastering her fear? If so, how did she do it? What worked best for her? Did whatever she feared really materialize?

Urge your client to learn more about new measures to improve security on planes and other public transportation. On a rational level, it may help her to know that these modes of travel are statistically much safer than driving.

In the longer run, as she learns to understand her own fear reactions, she can make better judgments about which sources of alarm to avoid and which to resolutely confront.

Q: A colleague at my planning firm is experiencing serious physical symptoms--dizziness, shortness of breath, chest pains--but he refuses to see a doctor. When I pressed him about it, I got the impression that he is terrified of being told something is seriously wrong with him. How can I help him get over his unwillingness to act?

A: Your colleague's method of dealing with the scary prospect of a life-threatening problem is total denial and avoidance. If you truly want to help him, take time to draw him out about his fears. Did he have a relative or friend who died prematurely of a heart attack, or became an invalid because of heart problems?

If he opens up to you, remind him gently that there are two possibilities: either he needs medical help, or he is worrying about nothing. In the first case, you can point out that advances in medicine have made heart disease less of a threat than before. If he has a family, you can buttress your argument by asking if he really wants to risk abandoning them by avoiding treatment that could save his life. On the other hand, if nothing is seriously wrong with him, he will have the relief of putting his anxieties to rest.

As a friend, you might even offer to accompany him to the doctor. With your support and encouragement, I wager you'll be able to help him move from panicky avoidance to confront the source of his fears.

Q: A client of mine is reluctantly retiring from his business to let his son take over. Despite having a more than adequate retirement portfolio, he recently confessed to me that without the daily challenge of his life's work, he may simply drop dead. This appears to be an intense fear of his. What can I say to help change his attitude?

A: Men--and in recent years, quite a few women--often have to overcome the psychic hurdle of overidentifying themselves with their work. The shock of losing a defining job is much like what happens to women who overidentify themselves with child-rearing, once their kids grow up and leave. In both cases, these individuals need to embrace a more multifaceted image of who they are and what they contribute to others around them.

You can begin by listening to your retirement-phobic client with compassion. Remind him that he is not the first to have an irrational fear of dying of emptiness or lack of purpose. However, there's a great deal he can do to keep his golden years from becoming an echoing wasteland.

First, there are bound to be struggling entrepreneurs or students who need his knowledge and expertise. Urge him to check with nearby universities or Small Business Development Corporations. Is there a charitable cause that speaks to him, maybe a child literacy program or college fundraising effort that needs a leader? Is there a business concept or field of interest he's always wanted to explore, a "road not taken" at some earlier stage of his life? In other words, he doesn't have to stop working. These days, a growing proportion of older Americans are remaining longer in the workforce (see "Still Working" sidebar below).

By helping your client identify new challenges, you will make it possible for him to welcome this new phase of life without feeling that he might as well give up and write his obituary now.

Q: Ever since a client of mine was laid off, his wife has become increasingly worried. With a toddler and an infant, she can't go out to work. When I bumped into her in town, she said she's going to apply for one of those jobs stuffing envelopes or making telemarketing calls from home. I told her not to overreact, but she's really afraid they'll go broke. How can I help her see things more calmly?

A: "The answer to every fear is knowing.... It is only the unknown that is fearful." This bit of wisdom, ascribed to author Richard Bach, is advice you might share with your anxious client.

Invite her to see you, with or without her husband, and ask about her worries. It's very possible that like many women, she harbors deep fears of losing everything and becoming a homeless bag lady. Or perhaps someone in her birth family was impoverished by a sudden catastrophe.

Then help her look more rationally at their financial situation. How much urgency is there to her husband's job search? What's the worst that could happen? If it did occur, how might they cope with it?

This sort of desensitization can be very effective in reducing anxiety. You can take it a step further with an exercise suggested by psychotherapist Gibbs A. Williams in "Coping with Fear," an online article posted soon after 9/11 (www.gibbsonline.com/coping.html). Ask your client to recall one of the scariest experiences of her life, along with any predictions of disaster that she made following this event. Then urge her to remember what the situation actually was six months later. Were things as bad as she imagined they would be? Williams makes the point that in most cases, what ensues is never as devastating as we feared.

Going through this exercise may help your client realize that the unknown does not need to have such power over her. Ideally, she will come to view this setback as a challenge that can be overcome, rather than a source of trauma and fear.

Q: The last time my widowed client came in to discuss her financial plan, she broke down in tears. Her parents, to whom she is very close, are both in rapidly failing health. She said she can't concentrate on anything these days because of her dread of losing them and being left alone. Please give me some idea of how to assist her.

A: Ask your client to consider how she can strengthen other sources of support: friends, relatives, spiritual or community connections. What new doors might open for her if she were no longer occupied in taking care of her parents? Is there an emotional and moral legacy of theirs that will continue to live on in her when they are gone?

I would also encourage her to identify or develop some self-soothing behaviors. These are a sort of tool kit that any panicked or highly anxious person can use to calm down and restore more optimal functioning. Some examples are going for a walk, knitting or listening to music, or becoming immersed in a beloved book or movie. Different things work for different people.

Progress may be slow. But with time and patience, you can help this client make space for new life to arise from her grieving and fear of loneliness.

Q: My client's son, who just graduated from college, has been offered a job doing development work in Indonesia. His parents are very apprehensive about the dangers he will face there, and want me to help persuade him to look for safer work in the U.S. I'm out of my depth here. Help!

A: It's very hard for parents to deal with fear for their child's safety. It may be equally hard for them to separate their desires and hopes from the child's own passions.

When my 25-year-old son went to India soon after the Mumbai train bombing, I had to remind myself that he is very careful about staying safe when he travels, that he speaks Hindi and knows the country well, and that he would not necessarily be safer at home in Washington, D.C. This self-talk helped me acknowledge how proud I was of him and the sensible way he had undertaken this business trip.

If you are a parent, you may have to reflect on your own biases and emotions before offering advice. In any event, I would suggest meeting with your client and his son to discuss the young man's plans. This may give the son a forum to explain where he stands. If he is truly committed to working in Southeast Asia, you might discuss ways his father can keep in touch with him. For example, Dad could visit soon after his son settles in at the new job.

It may help your client learn to surrender control over his son's destiny if you remind him that a parent's job is to teach a child courage, not timidity. If the young man is inspired to live in Indonesia, I believe that the father's acceptance of this decision, despite his own fears, is the greatest gift he can give his son.

Most people know that Franklin D. Roosevelt brought hope to the dark days of the Depression with his comment that "The only thing we have to fear is fear itself." But it was the great Eleanor Roosevelt who truly gave us a torch to light the way when she said, "You gain courage and confidence from doing the things you think you cannot do." When you help your clients recognize, understand, and embrace their fears, the new courage and confidence they develop can change their lives.

Olivia Mellan, a speaker, coach, and business consultant, is the author with Sherry Christie of The Advisor's Guide to Money Psychology, available through the Investment Advisor Bookstore at www.investmentadvisor.com. She also offers money psychology teleclasses for financial advisors, therapists, and coaches. E-mail Olivia at moneyharmony@cs.com.

Still Working

You may help retired clients deal with a loss of self-worth that sometimes accompanies the end of their worklife. But for many others that day may be further off than you think. The Federal Forum on Aging-Related Statistics reported in July that "a growing proportion of older Americans are in fact remaining in the workforce," a trend that has been building for the past 20 years. The Forum's Older Americans Update 2006: Key Indicators of Well-Being (a copy of the report is available here) notes that working participation rates for men 65 to 69 increased from 25% in 1993 to 34% in 2005, and for women, from 14% in 1985 to 24% in 2005. The report found that 14% of men aged 70 and over were working in 2005, up from 10% in 1993, while among women of the same cohort, participation rates increased from 4% in 1987 to 7% in 2005.

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