I have been thinking a lot lately about money and fear. While much of my business is helping others feel more confident and comfortable with their money, I am certainly no stranger to money fears myself.
Life Changes Can Dredge Up Money Fears
Having left my salaried job to start my own firm, mere months before my husband retired from his own 30+ year job, has led to a lot of financial change and uncertainty. Suddenly we went from a double income to leaning on our savings.
At the same time, I have been immersing myself in building out my business and much of that involves developing my methodology for how I can best serve clients. Traditional financial planning tends to focus upon behavioral changes without examining the reasons for the behaviors. Most often our behaviors are reasonable and rational when we consider our experiences and beliefs. My desire is to move beyond the simple behavior modification and explore our underlying emotions. Then we have the basis for deciding if we want to change our behavior.
Money Is Emotional
It is hard to miss the irony that I am deep in my own money emotions while figuring out how to best address these same topics with clients. But, just as therapists often have their own therapists and teachers send their kids to school, financial planners need to spend time on their own finances. Money is an emotional topic for everyone and that includes those who work with it every day.
Identifying Fears
I decided to model the vulnerability I ask of my clients and journal on some of my current anxiety surrounding my finances. Turns out I have more than a few. Below is a list of my money fears, in no particular order. I am afraid that…
- I will not have enough money to pay my bills
- I will not have enough money to care for my family
- I will not have enough money to retire
- I will not have enough money if I become physically unable to work
- I will not spend my money wisely
- the presence of absence of money in my life will change me and who I am
- others will judge me for the money I have
- others will judge me for the money I don’t have
- I will become reliant upon a certain standard of living
- I will be unable to maintain the standard of living I have become accustomed to
- my child will grow up poor and wanting
- my child will grow up entitled and spoiled
- I do or will compromise my principles and beliefs for money
- I don’t always spend my money in the most ethical manner
- I will inadvertently use my money to support people/causes I don’t agree with
- I don’t appreciate or feel enough gratitude for what I have
- I value things more for their financial than for their inherent value
- I am hoarding my money and, thereby, denying myself potential joy
- I am hoarding my money rather than putting it into the hands of those in need
Though not on my personal list, some other common money fears I have encountered in people include fearing that they…
- are not worthy of the money that they have
- do not deserve to have any money
- are irresponsible with money
- don’t have control over their money
- will be taken advantage of because of a lack of financial savvy
- will be responsible for supporting relatives
- will never get out of debt
- will never be able to afford to buy a home
- will not be able to recognize that they have enough money
The Roots of Our Fears
As I reflect upon both lists, several themes emerge:
- Fear of money scarcity
- Fear of not be a good steward of one’s resources
- Fear of the effect of money upon relationships and personal character
- Fear of responsibility
- Fear of unworthiness
Do any of these individual worries or general themes resonate with you? Do you have other money fears which are not on my lists? If so, I would be honored to learn what they are, if you feel comfortable sharing them with me.
I want to be explicit that I did not write these lists in order to bring up any bad feelings and I sincerely hope I have not done so Rather, I want you to see that these are common fears. We all have some fear surrounding money and it is nothing to be embarrassed about.
What Can We Do About Our Fear?
Unfortunately there is no magic pill to eliminate these fears. But, there are certainly some things that will help.
Identifying Money Fears
One thing that helps is to identify these fears. Often we try to ignore or push down these emotions and this can result in immobiling anxiety.
So, take some time to really consider and jot down your fears. Once you have done this, then consider what you can do to combat these fears. If you feel unworthy of money consider what past life events may be bringing about these feelings. If you worry about being a good steward, do some exercises to explore you goals and values. Reflect upon how your spending aligns with your intentions.
Gaining Knowledge
Knowledge is another great tool to fight fear. Often we fear what we don’t know or understand. The more you can learn about finance the less intimidated you will feel. I don’t necessarily mean reading the Wall Street Journal (though if that sounds interesting to you, go for it).
I am referring to understanding your own personal situation including what you own, where your money is, how much you owe, how much you earn, how much you spend, and what insurance coverage you have. Getting a sense of your full financial picture can be very enlightening. It can be tempting to stick your head in the sand, but getting a sense of your full financial picture can be very beneficial for both logistical and emotional reasons.
Making a Plan
After exploring your emotions surrounding money and your current financial situation, you will be in a better position to make a plan for your money. Even if you are someone who prioritize freedom and spontaneity, you may find a financial plan hugely beneficial. A plan will helps people to identify their resources, uncover their goals, and document their needs.
Some people will learn from a plan that they are more prepared than they thought. Others may discover that they still have work to do. But, they will emerge with a frame of reference and a clear direction towards which to work. Whatever your results, having additional insight will help to allay your fears. Often the unknown is what truly scares us.
Addressing Feelings of Money Scarcity
On a personal note, I discovered that most of my money fear was a result of feelings of scarcity. I equate money with security. In reality, however, having money is far from the only form of security. In fact, money is transitory. We are all subject to changes beyond our control such as losing a job, a stock market dip, a substantial and unanticipated expense, or high inflation.
The question I had to ask myself is what other forms of security do I have in my life? I started listing the non-monetary resources available to me: my Master’s degree, my employment experience, my partner, my network of close friends and family, my intelligence and resourcefulness. While none of these items are on my balance sheet, they provide me with a lot more security than my bank account or my income. No matter what my financial future holds I have lots of resources to care for myself and my family.
This is a complete mind shift for me and will take a lot of internal work to fully accept and recognize. But, I plan to make that effort. I know that truly acknowledging the abundance in my life, rather than focusing on the scarcity will allow me to overcome my fears and live more fully and joyfully.
I encourage anyone reading this newsletter to take some time to consider what money fears they harbor and how these fears may be weighing on them or holding them back. Once you determine the underlying emotions it is easier to take productive actions. Personally, I have found this exercise to be quite illuminating and freeing.