If you have read part I of money fears, hopefully, you would have spent some time identifying your own money fears and now that you’re aware of your money fears you can begin to challenge them.
How you start challenging your money fears is by asking yourself, “Is the money fear I am concentrating on, based on fear or is it grounded in reality?”
For example, if you are afraid you will run out of money, you would take a look at your spending habits and your amount of savings to see if this fear is justified according to how you use your money or if this fear is just a belief passed onto you for example by your parents, siblings or possibly friends’ who have this perception of you or hold that belief themselves.
If you find that after looking at your spending habits and your amount of savings, it is the case that you do not handle your money well, then that’s great as there are books, tools, courses and people who can help show you how to manage your money better.
If it is the case that this money fear that you have is just a belief passed onto you! then great again, as there are also courses, books, people and tools available to help you change the beliefs you currently have.
The first tool to help towards managing your money fears believe it or not is Financial literacy. Financial literacy refers to the knowledge, skills, and understanding that you can gain which enables you to make informed and effective decisions about managing your money. Financial literacy includes concepts like budgeting, saving, investing, borrowing, and understanding financial risks.
Key components of financial literacy include:
- Budgeting: Tracking income and expenses to manage spending effectively.
- Saving: Setting aside money for emergencies, future needs, or specific goals.
- Investing: Growing wealth by purchasing assets like stocks, bonds, or real estate.
- Credit Management: Understanding how loans and credit work to avoid excessive debt.
- Understanding Financial Products: Knowing how tools like insurance, mortgages, and retirement accounts work.
- Tax Basics: Recognizing how income tax and other taxes affect finances.
When you are financially literate it helps you to achieve financial stability, avoid debt pitfalls, and helps you plan for long-term goals. Financial literacy empowers you to make better financial choices to aid achieving your personal financial goals.
What about changing my beliefs and mindsets I hear you say? Well once you demystify something you gain a greater understanding of it and this enables you to use this thing rather than be used by it. This principle works in all areas of life, not just for money.
If you have money fears, your first negative belief about money, which you probably don’t even recognise, is that you think money and finance is complicated and that you don’t understand it all. This is why financial literacy is important, so the place to start is by understanding the common financial terms and concepts around money as this helps you manage your money better. Once we understand something, like for example the financial terms used and how banks, credit cards and investments work we develop confidence in that area and once we develop that confidence we are able to tackle any money issues that may arise.
Setting Financial Goals That Empower You
The great tool for changing your money fears and mindset is to set goals which can help transform your financial mindset from one of fear to one of empowerment. The trick is to set achievable, specific financial goals that align with your values. Whether it’s learning one of the aspects of financial literacy described above, saving a certain amount each month to secure your future, paying down debt, or learning about investing and growing your money, these kinds of goals will help focus you on building a positive relationship with money and as you reach each milestone, your confidence will grow, helping you to overcome those lingering fears.
Reaching Out for Support and Guidance
You don’t have to face your money fears alone. Seek out resources that can provide you with knowledge, support, and accountability. Talking to a financial advisor, joining a financial literacy program, or simply speaking with trusted friends or family can make a difference. Sharing your fears and goals with others can be empowering and help you stay accountable to the financial changes you want to make.
You can also try reframing your negative beliefs. If you believe that money is inherently stressful, try replacing that with the mindset that money can be a tool for freedom and choice. This small shift in perspective can open up new ways of thinking about money.
Remember: It’s a Journey, Not a Destination
Uncovering and working through your money fears isn’t something that happens overnight. It’s a journey that requires patience, self-compassion, and commitment. Along the way, celebrate your progress, however small it may seem. Each step you take—whether it’s setting a budget, building a savings habit, or shifting a limiting belief—is moving you closer to financial freedom.
The Bottom Line: Embrace Your Financial Journey
Money fears can feel overwhelming, but they don’t have to control your life. By uncovering these fears, understanding where they come from, and challenging them, you’ll be able to reshape your relationship with money and move toward financial empowerment. Embrace this journey and remember that with each step, you’re building a future where money serves you, not the other way around.
Be your own inspiration
