A Guide to Managing Your Fear of Money

Teenager with hand up in the air while on the phone

[Editor's Note: Kristin Wong penned this article on money management tips even through your fears a couple years ago, but it's as relevant today as it was then.]

My first year of high school, I was looking for an easy, goof-off elective — a class that would allow me to take a break in between Geometry and English, and maybe catch up on some magazines or take a quick nap. “Debate” sounded right up my half-assed alley.

On the first day of class, I was told we'd have to attend tournaments, in which we'd debate on topical issues. Politics. In front of people. I was a quiet student, and the most I knew about politics was that President Clinton had a cat named Socks. The thought of a debate tournament terrified me. But, because I was also lazy, I chose not to drop the class. I'll just deal with this fear later, I thought. A few months of classroom training and research went by, and I found myself fairly knowledgeable about current events. Which meant I'd have to participate in a tournament. Which meant I'd have to speak. Publicly. And this was one of my greatest fears, second only to cockroaches.

I vaguely remember that day, standing in front of a panel of judges. The lights dimmed, and I'd just drawn a question on U.S. foreign policy. Even now, writing this, I tremble a little, remembering how small I felt. I couldn't tell you exactly what I said, or how the judges reacted; I only remember opening my mouth and allowing words to come out. I dealt with it. I did what I needed to do.

Since then, I've had to let go of many, many fears. Sometimes, letting go is gradual. I was afraid of money for a long time. It kept me from budgeting, but I got over it. Then, it kept me from investing, and I just recently got over that. Even more recently, I've had to deal with one of my greatest money fears — not having a job. It was scary. I wanted to bury my head in the sand. But I dealt with it and did what I needed to do.

Related >> Money and Security: Fear of the Future

For some people, a fear of money can be overwhelming. Here's what I think you can learn from your fear — and how I think you can learn to manage it.

Why you might fear money

We've all got roots, and those roots shape our interests, personalities, and, yep, our fears. If you associate money with problems, it's probably because money has been a key player in the problems in your life. In college, I hated money. At one point, I worked two jobs and went to school full time, and it was because I didn't have enough money to pay for my crap. So money = my being exhausted and miserable.

Or, maybe money has been an uncomfortable topic in your life. Maybe you heard your parents shouting a lot about money when you were growing up. Maybe money was a big issue in a divorce. When you associate money with stuff like that, no wonder it's a taboo topic.

Or, hell, maybe you're just a natural worrier, like me. Even when things are good, I worry. Actually, especially when things are good, I worry. We could spend all day analyzing why I'm like this, but that's TMI and, suffice it to say: there's always a reason for money being scary. And, by its very nature, there's a lot of potential for money to be associated with scary stuff. Money has a large role in some unsavory things: extortion, Ponzi schemes, child support battles, etc.

Why this fear might hold you back

We've talked about this quite a bit, so I won't dig into it too much deeper. But a fear of money can hold you back in many ways:

  • It makes you afraid to manage your money, and then your budget gets all crazy and you go into debt.
  • It makes you afraid to look for a better job or ask for a raise. You tell yourself money doesn't matter to you, and then you become underpaid.
  • If you're terrified of losing your money (like me), it can hold you back from enjoying life. Or it can just make your life less convenient. Like when I was too cheap to buy a new computer for work and wasted hours rebooting and dealing with freezes. I could have been much more efficient, and much less annoyed if I bit the bullet and bought the new computer — which I had even saved up for!
  • Fear is a strong, emotional reaction, and strong emotions can hurt your ability to make a rational, reasonable decision.

How you can get over it

Here's what worked for me, along with other input.

Pinpoint your fear

It helps a lot to understand the root of your fear. Recognizing the source of your issue can help you better manage it. Let's say you're reluctant to look at your budget. Then, when you think about it, you realize you're avoiding it because you're afraid of what money has represented to you in the past. Maybe that budget will be busted. Maybe you'll see some numbers you don't like — because that's happened before. Knowing where your fear stems from can help you cope better. It makes the action digestible too. Knowing the source of something gives you a starting point for progress.

Identify patterns

In Taking the Leap: Freeing Ourselves from Old Habits and Fears, author Pema Chödrön uses a Buddhist principle to discuss fear. This is a practical money site, so I won't get into the spiritual aspect of it too much. But her overall point is that there are triggers to our fear. And these triggers hook us to a downward spiral of greater and greater fear, until whatever we're afraid of becomes insurmountable.

“If we catch it when it first arises, when it's just a tightening, a slight pulling back, a feeling of beginning to get hot under the collar, it's very workable. Then we have the possibility of becoming curious about this urge to do the habitual thing, this urge to strengthen a repetitive pattern.”

Instead of “strengthening” that downward spiral into greater fear, Chödrön says we should learn to understand the “familiar taste” of a negative pattern.

For example, I learned to do this with my public speaking. In class, when we'd practice for the tournaments, I'd feel a knot in my throat. I'd feel my stomach tightening. I knew what was coming next — thoughts like, What if I say something stupid? What if I trip up? From there, I'd get the shakes, and my face would turn red and I'd stutter a lot.

With money, I have a very familiar pattern when it comes to asking for a raise. First, I realize that I deserve a raise. I put it off. I rationalize it. Well, the company is going through tough times, I'll tell myself. Then, I get disgruntled.

These are all patterns of fear. Learning to recognize them is important.

But then what?

Face your fear

Once you know why you're afraid, and you know what happens when you're afraid, you're better equipped to face your fear. Chödrön says you should embrace it, even.

“Instead of seeing [your fear trigger] as an obstacle to be overcome, it is more helpful to consider it an opportunity for transformation, an open doorway to awakening. When I realize I'm triggered, I think of it as a neutral moment, a moment in time, a moment of truth that can go either way. What I'm advocating is that in that precious moment, we start to make choices that lead to happiness and freedom rather than choices that lead to unnecessary suffering…”

In more practical terms, you'll have to be “exposed to the stimulus,” says psychiatrist Ash Nadkarni in an interview with U.S. News:

“She adds that if you're continually exposed to the stimulus, you will hopefully start questioning and rejecting the thought patterns and behaviors fueling your fear.”

This is what I did when I forced myself to budget, every day. When I didn't have it together financially, the very thought of looking at my bank account made me want to gag. I'd developed a three-step pattern: 1) think about budgeting, 2) gag, 3) do something else instead.

When I committed to managing my fear, I forced myself to look at my budget each morning. The gag trigger was still there, sure. But I changed the pattern.

Related >> Budgeting Dilemma: How Do You Decide What You Can Afford?

Educate yourself

Probably the most helpful tool in your arsenal of overcoming fear is knowledge. After all, it's power, right? And power gives you control, and control helps you to stop letting your fears take over.

Had I not spent months brushing up on current events, I probably wouldn't have been confident enough to open my mouth in that moment. What would I have said in my debate? President Clinton is a great sax player? Socks Clinton rules?

In learning to get over my fear of investing, I read pretty much every Get Rich Slowly article on the topic (plus, some other places, ha). I'm certainly not a pro, but investing is a lot less scary to me now. And not only is not scary, it's actually something I'm excited about, because of my returns.

Focus on the positive

Not being afraid doesn't mean you'll never make mistakes. I got over my fear of public speaking (kinda), but I still say really dumb stuff all the time. It's embarrassing, but I learn from my mistakes, make a note of them, and then move on. For the most part, I try not to dwell too much.

Sometimes, I still make money mistakes too. I overspend, for example. But I learn to deal with it, read up on how to avoid it, and then focus on the positive ways money influences my life: It gives me security. It helped me get rid of debt.

This is just what I've found to be helpful. Like most things, you have to do what works for you. But fear seems to be an ongoing theme in my life lately, and I think it's because I'm learning just how much fear holds me back. I think it's totally okay to be afraid too. What matters, I think, is how you deal with it. Maybe “letting go” isn't the best way to put it. Maybe it's more about embracing and managing your fear. And then, ideally, if you deal with it productively, your fear transforms into something productive.

More about...Budgeting, Career, Psychology

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Alix
Alix
6 years ago

I’m afraid of losing my money by making the wrong choices… which explains why I haven’t replaced my car yet. I guess I’d rather have my cake than eat it…

Brian@ Debt Discipline
[email protected] Debt Discipline
6 years ago

I don’t think I every had fear when it came to money, I was just naive. Educating myself about money, budgets etc help get me on track to being debt free.

Dave Lalonde
Dave Lalonde
6 years ago

I really like what you said about how maybe fear is more about managing and embracing your fear. Never looked at it that way before. I know it sounds much easier than done, but I overcome fear by not thinking about it. But I do agree with identifying your fears. This is random, but what if people have fears that they are not aware of? I get that we need to find the source, but some people just have a hard time or are unaware they NEED to recognize what’s holding them back.

Babs
Babs
6 years ago
Reply to  Dave Lalonde

This probably sounds weird but for a long time I wanted to garden (in my head anyway) but I just didn’t really do it. Finally I figured out that I didn’t like to get my hands dirty. So I managed it by getting gloves. I am a much better gardener now.
If you want to know what’s holding you back start paying attention to how you’re feeling. Not everyone is a natural navel gazer. It will probably take you a while to get used to it.

Dave Lalonde
Dave Lalonde
6 years ago
Reply to  Babs

Wow that’s really interesting! Seriously, thanks for sharing that. Definitely random, but it all makes sense nonetheless.

Sean F.
Sean F.
6 years ago

Great article as usual Kristin!

Really good ways to examine our own fears and overcome the money related ones.

Fear by another name is power! Harnessing what scares us makes us better and you clearly have.

Btw you’re not alone. When things are good I too worry a bit for no reason!

Kristin Wong
Kristin Wong
6 years ago
Reply to  Sean F.

Ha ha. I’m glad you can relate; I hate that I do that. But I’m learning to calm down and enjoy the good rather than worry about losing it.

Sean F.
Sean F.
6 years ago
Reply to  Kristin Wong

My conundrum is that I don’t honestly worry too terribly much about a lot.

But it seems like when things get easy / manageable that is when my mind wanders to a bit of worry.

Your stories are always nice to read! Don’t worry about a thing!

Quinn
Quinn
6 years ago

Great article. Money fear can be debilitating for some – example, those wanting to retire but are too afraid to do the math to see if they can (or can’t). They continue on without taking action, instead of making that first step in the right direction.

David Salahi
David Salahi
6 years ago

Thanks, Kristin, for sharing the excerpt from Pema Chödrön. Very insightful. I just ordered the book.

Melissa Tosetti
Melissa Tosetti
6 years ago

This is an exceptional article Kristen.

I agree with you that facing fears and gathering knowledge are two of the best ways to get past what keeps us frozen in place.

LMoot
LMoot
6 years ago

* See, this is why I can’t have Twitter. Thank Jesus GRS doesn’t have a character limit. * This article couldn’t have come at a better time in my life. Two weeks ago I decided to leave the first permanent full-time job I’ve ever had. I’ve worked here for nearly 5 years and I love the people but not the culture, the work, or the industry. I liked the pay though and that’s where my fear kicked in. Although it was by no means big bucks, it was enough that I could regularly save 50% of my income (with the… Read more »

Kristin Wong
Kristin Wong
6 years ago
Reply to  LMoot

Naw, I don’t think it’s a crap way to get rich slowly at all. In the wise words of JD:

“Money gives you more options, but happiness makes life worth living. I believe that if we’re able to stay happy and in control of our lives, money actually becomes easier to manage.”

Money isn’t everything. I think the fact that you feel lighter than you have in ages speaks volumes.

LMoot
LMoot
6 years ago
Reply to  Kristin Wong

Those are some true words!

Elissa @ 20s Finances
Elissa @ 20s Finances
6 years ago

This is fantastic! Thanks for addressing a fear that isn’t commonly addressed. I have to encourage friends to manage their money before it turns into a disaster. It is so important, and the fear can be worked out.

Marcella
Marcella
6 years ago

Gah, fear! It’s such a complicated emotion, isn’t it? I’ve been fairly introspective about my own life over the last few years and am trying to recognise and overcome the part that fear is playing in my life. I am 35, a single woman, and have a successful ‘career’ (more on this below) that pays me a ridiculously high salary. I have always kept a very large buffer in my finances, so I’m scared to give this up. I work in Oil and Gas, but it’s in severe decline here in Melbourne. My global company always wants me to move… Read more »

Kristin Wong
Kristin Wong
6 years ago
Reply to  Marcella

Oy, I can so relate to this. But that bonus fear sounds like a real bummer! I wish I had an easy answer. Brave, 20-something Kristin says: “Do it! Do it! Let go and try to do everything you can in life. You might regret it if you don’t!” But slightly older (slightly more experienced and tired) Kristin says: “Meh, who cares what road you take? As long as it leads to your being happy. Also, I wanna take a nap.” Overall, though, my impulse leans toward pursuing dreams and not being held back by fear. I think it’s a… Read more »

Adrian
Adrian
6 years ago

Thanks for this article. Also, nice interview on kqed!

Kristin Wong
Kristin Wong
6 years ago
Reply to  Adrian

Thanks, Adrian!

Marlon
Marlon
6 years ago

A lot of people are not wealthy because they do not make enough money, they do. Its just that their psychological programming leads them to lose it, or spend it, or somehow they are just not able to keep it. The face is that much of the fears of money must be removed before someone can learn to keep money as any idiot can make money, its takes a wise person to keep it.

Jason @ Phroogal
Jason @ Phroogal
6 years ago

It really is how we respond to fear that matters. Either hide or face it head on. Fear gripped me to when I transitioned from my job to traveling and fear is always lurking in the new venture.

Monika Müller
Monika Müller
6 years ago

…maybe “30 lies about money” can help you deliberate your mind.

http://peterkoenig.typepad.com/eng/30_lies_about_money/

Jasmine Assan
Jasmine Assan
6 years ago

I believe most people have such thoughts of fear especially in college, picking easier course requirements to obtain easy credits but then you realize it is not as easy as it seemed to be. For instance in my college it is a requirement to take a course to boost public speaking skills. Being a freshman, this was my was one of my biggest fears; having to stand in front of people to present information or an idea. Getting over the fear came gradually, when I realized that I was not alone and got the support needed. Thankfully, I have been… Read more »

Christine
Christine
5 years ago

Thank you. Your writing gave me a good starting point for managing my money phobia

Jerome
Jerome
3 years ago

One of the best/strangest/idiotic (take your pick) piece of advice I once read with regard to reducing ones fear of money, and which worked for me, was to start carrying quit a lot of cash money in your wallet and NOT spend it. It has to be a meaningful amount which makes you nervous. I carried 500 dollar around with me for years. And I really got used to that money being there and me not using it. As I said, it worked for me.

Katie Ryan O'Connor
3 years ago
Reply to  Jerome

Jerome, this is actually brilliant!

Nan2000
Nan2000
3 years ago

this article really speaks for me. i have a lot of fears before and at times will hyperventilate thinking that i am getting old and no savings even though i was only 37yrs old then. however, when i bought my own place nearly 5yrs ago on mortgage i found that i don’t have those feeling anymore. though, still not completely happy because i still have some attitude towards money that needed readjusting but i am more happier and content. i am also looking forward for the future that hopefully in 5 years time would be able to buy another small… Read more »

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