The financial services industry is full of jargon that often confuses or even intimidates people. Words like “market,” “inflation,” or “risk” are thrown around without much thought about how they make people feel. But what if we changed the vocabulary? What if we framed financial concepts in ways that inspire confidence and action rather than fear and hesitation?
Market = The Great Companies of the World
Instead of thinking of the “market” as an abstract, unpredictable force, let’s recognise it for what it truly is—the great companies of the world. Investing isn’t about gambling on numbers on a screen; it’s about owning pieces of innovative and resilient businesses that shape our world. Apple, Microsoft, Amazon, Unilever, Nestlé—these companies represent the “market.” When you invest, you become a shareholder in enterprises that create jobs, develop new technologies, and contribute to economic growth.
Bear Market = A Big 30% Sale
A bear market—often associated with fear and panic—really just means that the great companies of the world are temporarily on sale. If you had your eye on a luxury car and suddenly saw it was 30% off, you’d be excited. The same should apply to investing. Bear markets are opportunities, not disasters, for those with a long-term perspective.
Retirement Planning = The Retirement Income Crisis
The traditional term “retirement planning” sounds like a simple to-do list, but in reality, many people are not financially prepared for retirement. Framing it as the “retirement income crisis” highlights the urgency of ensuring people have enough income to live comfortably for decades after they stop working. The focus should shift from accumulating a lump sum to generating sustainable, inflation-adjusted income.
Budget = Spending Plan
The word “budget” feels restrictive, as if it’s all about cutting back. A “spending plan,” on the other hand, is empowering—it’s a plan for how to use money wisely to enhance one’s life.
Inflation = Cost of Living Increases
Inflation sounds like an abstract economic issue, but in reality, it means the cost of your groceries, utilities, and healthcare will rise over time. Understanding it in real-world terms helps people plan for the future.
Happy Retirement = Dignity and Independence
A truly happy retirement isn’t just about relaxation—it’s about maintaining dignity and independence. Financial security allows people to make their own choices and live life on their own terms.
Fixed Income = Bonds, Cash, and Money Market Funds
Once thought of as safe havens, fixed-income investments now face challenges in keeping up with rising costs. Understanding their limitations is key to proper diversification.
Rising Income Investments = Increasing Dividends from the Great Companies of the World
Rather than just preserving capital, the goal should be growing income over time. The best companies in the world consistently increase their dividends, providing investors with a rising income stream to counteract inflation.
Risk = Volatility
Risk isn’t about losing everything—it’s about volatility, or price fluctuations. Long-term investors should embrace volatility as part of the journey, not as a threat.
By changing how we talk about finance, we can empower people to make smarter, more confident decisions about their money.
Dirk Groeneveld, Certified Financial Planner.
Recent Comments