Do financial fears keep you awake at night? Are you experiencing signs of stress due to constantly worrying about your financial situation in both your business and personal life? Although all of your financial fears may feel very real, some may be far less troublesome than they seem while they are rattling around in your head. In fact, focusing mental energy on financial fears is how they quickly grow out of proportion.
Synthesizing, prioritizing and gaining perspective on your money concerns are important first steps in gaining more control of your life. Depending on the situation, fear is an emotion that is often unrealistic. Being honest with yourself about your money helps you reassess whether your financial fears are accurate or distorted. This process reduces the power your financial fears hold over you.
Reducing the power your financial fears hold over you begins by differentiating between those fears which are legitimate, those which are not, and those which are actually repetitious. Here’s how to get started.
Make a List of All of Your Financial Fears
Taking ownership of your financial fears empowers you to move beyond the negative feelings which traditionally accompany them. So, to get started, set aside time to make a list of each and every one of your financial fears. Don’t skip any no matter how trivial one may seem or how self-conscious you may feel about one of your financial fears. Remember, everyone has fears about money. So, write down each and every fear that comes to mind.
Putting your fears in words, on paper, takes them out of your head and begins the process of reducing financial stress. Seeing your financial fears in writing provides you the opportunity to realistically evaluate which fears are real and which fears are worse than others.
Organize and Categorize Your List of Financial Fears
Arrange your list according to each item’s degree of urgency. Use a scale of 1 to 3 with those fears labeled 1 needing the least amount of attention and those labeled 3 needing the most attention. Strive to honestly assess your fears and label them accordingly. Here’s a hint: They aren’t all number 3.
Next, identify any of the financial fears on your list that are repetitious. Once you do this, consider eliminating any fears that are redundant or ones you label with the number 1. Following this step allows you to focus your attention on the financial fears causing you the most worry.
The remaining fears on your list need to be grouped into categories which identify the financial area each concern falls under. Those categories could include the following: budgeting, spending, debt management, goals, cash flow, saving, emergency fund, etc.
Focus on Number 3
Under each category, move any items with a number 3 to the top of the list. Decide which number 3 in each category is the most important to address first. From those selections, pick the 3 most important ones. Whether or not you realize it, these are probably the financial fears that have been stressing you out and keeping you awake at night. These financial fears are the ones needing immediate attention.
Remember, knowledge is important to the process but taking action is critical. Now it is time to use what you’ve learned about your top 3 stressors and take the appropriate actions to reduce your financial fears. Your increased financial awareness prepares you to take the next step in overcoming your financial fears developing a downsizing plan.
Truly Define Your Top Three Financial Fears
To get to the root of the problem, explain your top three fears in 25 words or less. Then, assign each of those fears to a category. Let’s look at couple of examples to help you get started.
If you are worried about your daily living expenses, you might write the following: My expenses exceed my income which makes it difficult to pay my bills, reduce my debt, or save money. This makes me feel out of control. Now that you have a description, you could assign this description and fear to your Spending category.
Here’s another example. If you are worried you lack funds for an emergency, you might write the following: I don’t feel prepared to handle a situation if something unexpected happens a situation like a car repair or illness. My resources won’t cover the expense. This one could go in your Savings category.
What and When: Set an Action Plan and Timeframe
Once you’ve fully defined your top three financial fears, identify two specific actions you can take to address each of those fears, and assign a time frame for each of those actions. Let’s use our above Spending example and add actions and a time frame.
In this case, your response might read like the following: Tomorrow I will call my credit card companies and ask if I can reduce my monthly minimum payments. In the next week, I will call a non-profit consumer credit counseling agency to find out whether or not credit counseling would be a helpful option.
After completing this step with your first of your top three financial fears, continue the process with the next two. Taking action will help you become more in charge of your money and your life. You’ll discover you are actually downsizing your financial fears as you become more hands-on with your money. You will also gain confidence as you recognize your right, responsibility and ability to create a better financial future.
Finally, Give Yourself Permission
As you move towards financial wellbeing, many of your thoughts, feelings and attitudes about money will change. Honor those changes in positive ways. Most importantly, give yourself permission to celebrate your efforts and successes when downsizing your financial fears and right-sizing your financial life.