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When it comes to the biggest worry about retirement — that you will run out of money — author and podcast host Farnoosh Torabi can help. 

“If you’re somebody who’s in your 50s and you’ve made it this far without ever missing a mortgage payment — or, you know, not putting food on the table or putting gas in your car — you deserve a gold trophy,” she says. 

A lifelong worrier herself, Torabi understands that fears about money are deep-rooted and are usually part of a much bigger psychological pattern. But she also understands that you can use that unease. It can even become your superpower. Maybe you just need to hear that you can be anxious about running out of money — but if you haven’t actually run out so far, you can start to trust yourself. 

Torabi’s new book, “A Healthy State of Panic,” delves into her own history with worries about money, from growing up as the child of Iranian immigrants to her time as a struggling journalist to the launch of her podcast, So Money. Along the way, she learned how to harness her worries and use them for good. 

“Look at your own personal performance chart,” she says. “That should give you that context and confidence. And you know what, sometimes think to yourself: The fear got me this far.”

MarketWatch recently spoke with Torabi about her new book and about how to tackle that big fear of running out of money after a lifetime of saving. A video clip of our interview with Torabi is available on Instagram. Here’s how she says you can use your fear for good.

Investment fears

Torabi presented her new book recently to a group of financial advisers — the people who handle our money and deal with our preoccupations about it. What she hopes those folks get out of the book is that our fears really matter. They aren’t just something to be dismissed. 

“I think [advisers are] really interested to know how to help their clients work through their fears,” Torabi says. “I think where they can really show up for their clients is to not make them feel ashamed of feeling fearful.” 

The job of the adviser, she notes, is to fill in the blanks of what the client doesn’t know, give context and provide some historical patterns. Then they should see what style works for the client. Maybe putting a big lump sum into a Roth IRA is too scary, for instance.

“Depending on your risk tolerance, maybe you’re not the lump-sum investor,” she says. “So you can do it over the course of the year in drips if you’re somebody who’s really nervous about volatility in the market and you would lose sleep over a down week. It’s about listening to your fears and seeing how we can still get to that finish line while honoring [your] fear — which is really [your] risk tolerance.”

Getting to the root of fear

Torabi says that most of the guests on her podcast who come to discuss a money issue have something going on other than what they think they are there to discuss. 

“This is where someone who’s really good at coaching or therapy can come in,” she says. “Having a financial adviser or someone who is objective is sometimes the key to getting you to face these fears and kind of laugh at them. The perspective is so important.”

Maybe that fear of scarcity got you to a place where you can save, but it tends to have a diminishing return.

 “You’re going to get to a point where it’s just like this roommate that you can’t get out of your apartment,” Torabi says. “It’s not as easy as just saying, ‘Go away.’ You have to go through that journey of understanding its roots and come to terms with it before you can say, ‘OK, enough, I’m moving on.’”

Flush out worst-case scenarios

Torabi likes to jump right into the deep end when it comes to catastrophizing worst-case scenarios. “Bring that fear to your doorstep and apply it into your life,” she says. “If you’re really afraid of losing money, well, OK, let’s take inventory of what you have, what you’re doing.”

You can then map out various plans — plans A through Z if you need them — and this will give you perspective. “Fear loves to thrive where there is a lack or a gap of knowledge of just facing the truth of your life. It’s human nature. We just sometimes can live in the clouds. And my thing is like, bring it down to earth.”

If it turns out you have been doing a poor job of saving or have been spending too much, then you can adjust and use that as a wake-up call, she adds. 

“Sometimes the fear of not having enough is actually pointing you to real gaps in your financial plan that you’re worried about,” she says. “So let’s go fill that.”

How? One way she suggests is to imagine a life in the future in which you continue to work into your 70s and 80s but you don’t want to, or in which you’re dependent on your children. You never will feel like you’re at rest and earning that retirement, which is not a great feeling. 

“Use that fear to catapult yourself to address some of these things in your life today,” she says. That could mean increasing your investments, making more money, being more aggressive about paying down debt or downsizing your life.

Tricks to spending

The fear of running out of money leads many people to fear spending — either now or in retirement — and missing out on the point that the reason you have money is so you can spend it. 

Torabi often gets letters from people who say they have something like $400,000 in their checking account but that they haven’t taken a vacation in forever because they’re not sure they can afford it.

Her response: “Being able to use your savings to take a vacation is success. That is what the end goal is. It’s not just to have money to have money. You should feel allowed to do that now.”

To get out of the fear mentality around spending money, she says to go back and look at your cash flow and see how long it would take you to replenish what you might spend, either with earned income or investment returns. Say you spend $5,000 on a trip and it will take you three months to earn that back. That might be comforting to know. 

If that still seems scary, Torabi says to budget more ahead of time, or look for discounts that make you feel good about how much you’re saving. “You just earmark it, and you work that into your expenses every year,” she says. “Sometimes with fear, you go do the thing that you want, but then compensate for it by doing something that might offset the risk that you’re really worried about.”

At some point, you’ll end up working out a way to feel good about it. It’s sort of like exposure therapy. 

“Money ebbs and flows. There’s going to be opportunities to refill that bucket. It just depends on how fast you want to do it,” she says. “And you know, maybe you don’t even need to put the money back, because you have a lot left from where it came from.”

More interviews from Beth Pinsker

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