Why Do We Avoid The Things That Matter Most? Greg McKeown And An “Essentialist” Approach To Personal Finance

The Strange Law of Inverse Prioritization: Why We Avoid What Matters Most

In a recent conversation with Tim Ferriss, Greg McKeown, author of Essentialism, dropped a provocative idea: the "law of inverse prioritization." McKeown explains that the most important tasks in our lives are often the ones we’re least likely to tackle. Why? Because these tasks carry immense emotional weight, and the fear of failure or the pressure to perform perfectly can be paralyzing. This phenomenon isn’t just a curious observation; it has profound implications for how we manage our personal and financial lives. By understanding and addressing this inverse prioritization, we can break through the barriers that stop us from moving forward.

The Emotional Weight of Important Tasks

McKeown argues that our most critical tasks are often tied to our identities, making the stakes feel unbearably high. For example, managing money is one of life’s most essential tasks, yet it’s common to procrastinate on financial decisions. This isn’t just about laziness or lack of knowledge. Instead, it’s often rooted in fear—fear of making mistakes, fear of not being perfect, or fear of confronting uncomfortable truths about our financial reality. Additionally, the sheer amount of information available can overwhelm us, and the financial industry’s focus on profit over people only adds to the confusion. Together, these factors create a perfect storm of paralysis.

Prioritizing Financial Growth: Overcoming Present Bias

One of the most critical financial tasks is growing our assets, but this often feels like an uphill battle. Why? Because of our inherent "present bias," a tendency to prioritize immediate gratification over future rewards. As Dr. Hal Hershfield, a UCLA professor and author of Your Future Self, puts it, saving feels like choosing between spending money today or giving it to a "stranger" (our future selves) years from now. To overcome this, we need to make our future feel more real. Hershfield suggests using imagination to vividly envision what we want our future to look like, making it easier to prioritize saving and investing.

Automating savings is another practical solution. For example, contributing to a 401(k) or setting up auto-escalation on retirement contributions can help us build the habit of saving without constant decision-making. This not only makes saving easier but also gives us a sense of control and confidence, which can "spill over" into other areas of our financial lives. By focusing on what we can control, like regular saving, we can build resilience and reduce anxiety about the unpredictable nature of financial markets.

Protecting What Matters: Facing Fear and Building Security

Protecting our assets and loved ones is another critical financial pillar, but it’s also one of the most emotionally charged. Two types of fear often stand in our way: fear of the known (e.g., death) and fear of the unknown (e.g., unexpected expenses). For example, while life insurance is a straightforward way to protect our loved ones, many people avoid it because it forces them to confront their mortality. Similarly, the uncertainty of unexpected expenses, like a medical emergency or car repair, can create a sense of dread.

The good news is that there are practical ways to address these fears. For known risks, we can use one of four strategies: assume the risk, eliminate it, reduce it, or transfer it (e.g., through insurance). For unknown risks, building an emergency fund or maintaining financial margin provides a safety net. By taking these steps, we can reduce fear and create a sense of security, allowing us to focus on other areas of our lives.

Giving Back: Aligning Money with Purpose

While many people don’t think of themselves as philanthropists, most of us are driven by a desire to contribute to something bigger than ourselves. As Daniel Pink writes in Drive, the most motivated people "hitch their desires to a cause larger than themselves." For some, this might look like donating to charity, while for others, it could mean funding their children’s education or creating a will to ensure their loved ones are cared for.

Estate planning, in particular, is a critical but often neglected task. While it forces us to confront uncomfortable topics like death, it’s also an act of love and generosity. By creating a will, for example, we can ensure that our assets are distributed according to our wishes and that our children are cared for if something happens to us. If there’s one financial task to prioritize, it’s this.

Living Intentionally: Funding the Life You Want

Finally, it’s important to remember that financial planning isn’t just about preparing for the future—it’s also about funding the life you want to live today. Too often, budgeting and financial planning are seen as restrictive or joyless, but this doesn’t have to be the case. The best financial plans intentionally allocate money for things that bring joy and fulfillment, whether that’s date nights, vacations, or hobbies.

For example, funding a marriage or relationship can be one of the most rewarding investments we make. By setting aside money for shared experiences, we can strengthen our relationships and create lasting memories. As Bill Perkins argues in Die With Zero, the goal isn’t to hoard money until the end but to use it to live fully—both today and in the future.

Conclusion: Taking Control of Your Financial Future

So, what’s the most important financial task you can complete this year? It might be automating your savings, addressing a fear by purchasing life insurance, or simply taking the first step toward estate planning. Whatever it is, remember that the most important tasks are often the ones we’re most likely to avoid. By acknowledging the emotional weight of these tasks and taking small, intentional steps forward, you can break free from the cycle of procrastination and create a financial plan that aligns with your values and goals. The future you’ll thank you.