Get Your Financial Fix! Subscribe For Our Latest Planning Tips.

Our Financial Triggers: 4 Huge Reasons For Our Fiscal Panic

What makes us tick? That’s an important question to answer, especially when it comes to our finances. If we don’t have a firm understanding of what can cause us to panic and act impulsively, then we’re doing our future selves a disservice.

Together we’ll review some of the most common financial triggers that cause people to feel panicked, anxious, or depressed in regards to their money. We’ll also break down how they occur, and how they influence you. Once you understand how they work, you’ll be able to spot them ahead of time, and deter their threat to your finances. 

#1 Negative News

Turning on the news is like opening a portal into the terrible. If COVID and corrupt politicians weren’t enough, how about a maniacal dictator (with nuclear weapons) starting a war on a peaceful country? And if you’ve ever thought there was negativity bias in the news, you were probably on to something (duh). 2020 coverage of the pandemic serves as a recent example. 

Researchers examined coverage of COVID-19, across U.S. media outlets like CNN, The New York Times, Politico, Fox News, and hundreds of others both domestically and internationally. Then, using a social-science language classification technique, the researchers categorized coverage as negative, neutral, or positive.1

It was found that about 87% of Coronavirus coverage was negative in national U.S. media. Instead of “positive” pandemic coverage of things like case reductions, survival stories, or vaccination improvements, most coverage went to where cases were rising and instances with vaccination problems.1

Researchers felt a major driver of this negatively distorted coverage was simply consumer demand. They just gave people what they’d pay attention to.1 Wait, are they saying we’re more entertained by dread than happy endings? (duh, but that’s F’d up) So if you’re feeling anxious about market drops, downturns, recent crashes, or potential disasters in the news, realize you may be being spoon fed an overly negative view of things. 

#2 Recency Bias

Recency bias is our tendency to overemphasize the importance of recent experiences.2 It’s why you might feel the urge to get shredded after a Bowflex commercial, or fear taking a nighttime stroll after a horror movie. 

This is also why the negativity in the news can create such vicious cycles. Take for example the phenomenon of panic selling, which happens when there’s a massive selloff of securities because fear starts overriding thoughtful analysis.3 It usually goes something like this:

  • Negative news breaks on the market
  • Recency bias overemphasizes the negativity
  • Fear sets in and people start panic selling

This pattern feeds on itself and creates what’s known as a positive feedback loop. This means the end result of a pattern spurs the initial action that began it.4 These loops will also drive prices artificially upward, and create market bubbles. These price-inflated bubbles eventually pop, and can lead to crashes with loops going back down.5 

Whether it’s driving market prices up or down, recency bias is powerful. It’s an error in human judgment that can cause us to invest impulsively and allow emotions to take over logic. We can get caught up in panic and take actions that only worsen our situations. Be aware that recency biases exist and that they often work in tandem with the herd mentality. 

#3 Herd Mentalities

Wildebeests travel in herds, and that’s because they offer protection and guidance. If they’re separated, they become more susceptible to outside threats. And though we’re missing horns, tails, and hundreds of their pounds, we’re not all that different. 

People seek refuge in the masses too, and it’s why we can feel so much pressure to just  “fit in.” Whenever we stand out from the crowd we risk exposure, shame, or ridicule. And if the masses turn on us, we risk being cut off from vital resources like jobs, love, and relationships. 

Wildebeests also travel in herds to find prosperity, which in their case is a bunch of water and grass. But is the herd always successful? No, and neither are herds of humans when they search for economic prosperity. 

As stated above, the masses often engage in activities that damage their success. They see others panicking about a drop, and start selling when they should hold. They see others panicking about missing out, and buy into the latest trends when they should think twice… 

*cough* NFTs *cough* 

Following in the footsteps of others can be incredibly helpful. By modeling the healthy financial habits of others, we can build ourselves up stronger. But always defaulting to the herd mentality, can cause us to panic and make brash decisions. And even when modeling the best, we have to be careful not to overpressure ourselves.   

#4 New “Normals”

As much as I love modern technology I’m relieved I didn’t grow up with social media. A 2016 study linked more social media use, and emotional investment in it, with worse sleep quality and higher levels of depression and anxiety in teens.6 

And it’s not hard to imagine why. Other studies have found social media to be triggering in teens for the following reasons:7 

  • It can expose you to events you weren’t invited to
  • It can create pressure to be attractive and well-liked online
  • It can create intense fear of missing out
  • It can create pressure to always be involved

When we only follow people we admire for their fame, wealth, fitness, or lifestyle we can create an echo chamber. We start seeing only images of exuberant spending, traveling, and aesthetics. Then we fall into the trap of thinking that this is the new “normal,” and think it’s what everyone else is experiencing. 

Chip and Joanne got anyone else constantly upgrading their home?

But this is a distorted reality like the news. Only instead of being exposed to mostly negative information, we’re exposed to mainly positive information. Our mental health is sacrificed as we constantly compare our own financial situations with that of extreme outliers. And we can start to feel panicked, anxious, and depressed due to the new financial standards we’ve made up.  

#5 Thinking We’re Alone (Bonus)

Trying to stay on top of taxes, investing, budgeting, and earning an income can be overwhelming. Add on top of that negative news, recency bias, herd mentalities, and faux social media standards, and it can feel like we’re drowning. 

We need people in our corner to help us through. Whether it’s co-workers to meet pressing deadlines, family members to get us through hard times, or mentors to take us to the next level, we’re better able to grow when we work with others. And the same holds true when managing our finances. 

At Crafted Finance we help clients understand their goals, develop plans for their attainment, and stick to the process. And we’re experienced in helping them navigate the panic and emotional turbulence of modern, everyday life. Feel free to reach out to us at (650) 336-0598 with any questions, or fill out a contact card here, and we’ll reach out to you.

Investment Advisory Services are offered through Crafted Finance, LLC, a registered investment adviser. Please remember that securities cannot be purchased, sold or traded via e-mail or voice message system. This advertisement and any documents, files or previous advertisements may contain information that is confidential or legally privileged.  If you are not the intended recipient, you are hereby notified that you must not read this transmission and that any disclosure, copying, printing, distribution, or any action or omission of this transmission is strictly prohibited.  If you have received this advertisement in error, please immediately notify the sender by telephone at (650) 336-0598 or return and delete the original advertisements and its attachments without reading or saving in any manner.

Share This Blog Post:

Kristin Harad

Marketing Coach

Kristin Harad is a Marketing Coach extraordinaire, guiding businesses and professionals through the complex world of marketing with her expertise, passion, and a proven track record of success. With a deep understanding of branding, strategy, and communication, Kristin empowers her clients to unlock their full marketing potential.

With over a decade of experience in marketing, Kristin is a true luminary in the field. She possesses a keen eye for trends, a knack for identifying opportunities, and an unwavering commitment to helping her clients thrive in the competitive business landscape.

Jon Fogg

Content Creator

Jon Fogg is a dynamic and innovative Content Creator who has been making waves in the digital realm. With a passion for creativity and a flair for storytelling, Jon has captivated audiences worldwide through his engaging and diverse content.

As a pioneer in the world of content creation, Jon Fogg has consistently pushed the boundaries of what’s possible in the digital landscape. His journey began with a humble camera and a dream, and he has since evolved into a multi-talented creator, producing content that spans various genres and platforms.

Kingston Hollman MBA


Kingston Hollman MBA is a seasoned professional in the field of compliance, known for his extensive expertise and dedication to maintaining regulatory integrity within organizations. With a strong educational background and years of experience, Kingston is a trusted authority in the compliance arena.

Armed with a Master of Business Administration (MBA) degree, Kingston possesses a profound understanding of the intersection between business strategy and regulatory adherence. He combines this knowledge with a meticulous approach to ensure that organizations navigate complex compliance landscapes effectively and ethically.

Throughout his career, Kingston has demonstrated his ability to develop and implement comprehensive compliance programs tailored to specific industries and regulatory frameworks. His keen attention to detail and analytical mindset enable him to identify and mitigate potential risks while fostering a culture of compliance within organizations.

Kelly Gosiewski

Client Service Administrator

Kelly Gosiewski is a Client Service Administrator known for her unwavering dedication and exceptional client-centric approach. With a career spanning several years in the financial services industry, Kelly has consistently demonstrated her ability to provide top-tier support to clients and ensure their needs are met with the utmost professionalism.

Kelly’s role as a Client Service Administrator involves managing client relationships with a keen focus on delivering outstanding service. Her strong interpersonal skills and attention to detail allow her to understand client requirements and address their concerns effectively, fostering strong and lasting client partnerships.

In her career, Kelly has excelled at streamlining administrative processes, ensuring that client accounts are meticulously maintained, and transactions are executed seamlessly. Her commitment to accuracy and precision is evident in all her interactions, earning her a reputation for reliability and trustworthiness among clients and colleagues.

Dionne Kelly

Executive Assistant

Dionne Kelly is a highly accomplished and dedicated professional serving as an Executive Assistant with an extensive track record of providing invaluable support to senior executives. With a career spanning over a decade, Dionne has consistently demonstrated her exceptional organizational prowess, meticulous attention to detail, and unwavering commitment to enhancing operational efficiency.

Throughout her career, Dionne has been a trusted right-hand to C-suite executives, adeptly managing their busy schedules, prioritizing tasks, and facilitating seamless communication within the organization. Her ability to anticipate the needs of her superiors and proactively address them has been a hallmark of her success.

Joe Wride CFP®

Founder & CEO

Meet Joe Wride, the president and founder of Crafted Finance. With a knack for pension and investment management, insurance, and financial planning, Joe’s all about offering top-notch services without breaking the bank. That’s why he started Crafted Finance!

A proud Finance major from Washington State University, Joe’s got the credentials to back it up as a Chartered Life Underwriter and CERTIFIED FINANCIAL PLANNER™ Professional. Since 2009, he’s been helping individuals, families, and pension plans make sense of their finances. Joe’s even on the board of the Financial Planning Association’s Puget Sound chapter. Check out his LinkedIn profile here.

Joe gets that everyone’s got their own money story. That’s why he’s crafted a unique process to help folks of all stripes manage their finances, whether they’re flying solo, raising a family, or running a company. He’s all about learning and growing to make sure his guidance is just the right fit for his clients.

When he’s not crunching numbers, you’ll find Joe enjoying the Seattle life. He’s into skateboarding at Alki beach, biking, golfing, snowboarding, hiking, and camping. Sports fan? You bet! Joe’s a die-hard supporter of the Cougars, Mariners, Seahawks, and Sonics. But what really matters to him is family time with his wife Jessica, daughter Ocean, and dog Kanga. Joe’s excited to welcome more kiddos into their home through foster care and adoption in the future.

Download for Free

Property Is Power.

Let us know which email address to send this Free eBook to down below:

Please enable JavaScript in your browser to complete this form.
This best describes my experiance in real estate investing:

Get Your Financial Fix!

Subscribe So You Don’t Miss Our Latest Planning Tips.

Search Site