4 common money fears to overcome

Most people share a certain kind of financial fear. Some people can overcome these fears with support, while others will be ruled by them for the rest of their lives. Living a life where financial fears are paramount can keep you trapped in unhealthy financial mindsets.You can even lose money for the rest of your life.

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Even if you’re too scared to borrow money, you can break the cycle and develop a healthy financial attitude that sees money as a tool to help rather than a hindrance. Here are some of the most common money fears and what you need to do to overcome each.

fear of bankruptcy

Let’s start with one of the most common financial fears.

This is often a learned money belief or habit, says Chloe Elise, certified financial coach and CEO of Deeper Than Money. Usually a person with this fear observes it from her parents or grandparents.

“They think they’re always short of money and they’re afraid they’ll run out,” Elise said.

Breaking this belief can be very difficult, but the ultimate goal is to see money through the mindset of abundance. According to Elise, some of her clients have adopted the mantra “money flows to me” as a way to start welcoming money into their lives.

But you need more than a mantra. Starting to welcome money into your life is watching your money work for you. Elise’s favorite recommendation for doing this is to keep emergency funds in a high-yield savings account is to

“With full liquidity and no risk, HYSA is a great way to see interest accumulate in your account without you having to do anything,” said Elise, noting that interest rates are currently over 3%. I added that there are.

Once you do that, Elise says, you can consider other investments, such as a retirement account or real estate. This will lessen your fear of stepping outside your comfort zone and increase your chances of being rewarded.

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Fear of checking bank accounts

After enjoying an expensive weekend or a week of vacation, are any of us paralyzed by fear of what will happen to our bank accounts in the aftermath of these pending transactions? ?

Here’s what happens if you don’t verify your bank account today. It is unlikely that I will check tomorrow or the day after tomorrow.

“What is common is that feelings of guilt and shame from spending money come swirling around,” Elise said. Eventually a month goes by and you start feeling uneasy about facing your finances.

To overcome this fear, Elise recommends planning as far in advance as possible. If she goes on vacation, she can create a bucket in her travel-only savings account, Elise said.

“Before you travel, you are already mentally prepared for what that money will be used for. If you already know what your bank account will look like, checking your bank account is easy. says Elise.

Fear of being ridiculed

If you don’t understand how APRs work, the difference between a traditional IRA and a Roth IRA, or what mutual funds are, you’re probably not alone. Financial industry jargon can often sound difficult to understand, but this comes from her self-belief that “I’m bad with money,” she says.

“You might even think that no one understands it but you. The result is a fear of feeling stupid financially.”

Fear of feeling stupid about money leads to a domino effect of other fear-related behaviors that can affect money. will be afraid of If you’re afraid to talk about money, you won’t be able to ask the questions you need to get the answers you need to defend yourself and improve your overall financial literacy.

Don’t let your fear keep you in the dark! Follow Elise’s advice to start a fun, light conversation about money with your friends and family.

“Ask them if they have a bank or credit union, or what their financial goals are this year. This will give them more confidence in their money and lessen their fears,” Elise said.

fear of failure

Stephanie Genkin, CFP and founder of My Financial Planner, recently worked with a high-paying client who was stressed about money. The client’s boyfriend out of her good faith recommended that she set aside six months’ worth of cash for emergencies.

The advice wasn’t necessarily wrong, but Genkin’s clients felt insecure and inactive. She had increased her credit card debt and only had about half a month of spending in her savings account.

Genkin talked to customers about money. Over time, the client opened up about his beliefs about money and his family’s financial history. She agreed to have a small amount of money automatically deposited into her online savings account to ensure she had saved at least a month and a half of her expenses by the end of the year.

Genkin noticed a shift from anxiety to excitement in the client. what changed? Clients are overwhelmed by the six-month timeline and afraid to fail, he said.

“I understood her challenges and encouraged her to do something small instead of striving for perfection,” says Genkin.

Many financial fears are about not being perfect or having everything together, but it’s important not to let the fear of perfectionism take over your finances.

“Small steps that can be taken over time lead to big improvements,” says Genkin. “Please forgive me for not being perfect.

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This article originally appeared on GOBankingRates.com: 4 Common Money Fears to Overcome