After college, I felt lucky that it didn't take long to find a job. I counted my blessings and enthusiastically entered the working world. Months later, I was offered a better, higher-paying job. You'd think I'd be happy, but I wasn't. Not entirely. I was mostly afraid.
Illustration by Tara Jacoby
The opportunity was tempting, and it was in line with what I should have been paid in that industry. But I was terrified of the risk. What if it didn't work out? And what if I couldn't find anything after that? What if I had nothing? The fear of losing out on a steady income scared me so much, I almost neglected taking a great job that paid well and would eventually help me pay my student debt.
Fear can serve a purpose, to some degree. At first, it lit a fire that helped me reach some financial goals. To some extent, it helped me work hard. But after a while, that same fear started getting in the way more than it helped. Here are a few financial fears I've dealt with, and what I did to get over them.
I Was Afraid Of Losing My Income
Probably my biggest money fear was losing my job. Or, more specifically, losing my income source. It's an understandable fear. I was afraid of the struggle of not having enough to get by. My family didn't have much growing up, and it sucked, and I don't want to go back to that place.
In a way, that fear served a purpose. It probably helped shape my work ethic a bit. You tend to work pretty hard when you're terrified of being fired.
As understandable as this fear may be, it also got in the way of some pretty important stuff. It started to control most of my major decisions, for example:
- I started a career I didn't enjoy because it paid well. My fear was ruled by money, and, in turn, so was I.
- I never asked for a raise, because I was terrified my boss would think of me differently and maybe eventually fire me.
Conquering this fear had a lot to do with learning to speak up for myself and become comfortable with taking risks. But because the fear does have some foundation in reality — not having a steady income can be scary — I had to work with it, too.
For example, I saved an adequate amount for an emergency. That emergency fund lessened the fear; I felt more comfortable taking career risks, because I knew I had a safety net. Second, I calculated the risks I took. When I decided to embark on a new career, for example, I saved for it and devised a plan for the transition. I took the risk, and it was a risk that paid off well, both financially and emotionally. Having a plan in place and a safety net in case of emergency played a big part in dealing with this fear.
I Didn't Want To Regret Spending
Another financial fear of mine? Spending too much. It's not a huge fear, really, and, on the surface, it's actually not a bad one. You should avoid overspending, right? Sure, but this fear has gotten in the way, too.
For example, as a freelancer, I spend a lot of time on my laptop. For a while, my laptop was on its last legs, which made work very difficult. It took me longer to get stuff done, and I was constantly frustrated with my system. I had the money to spend on a new computer, but I couldn't get over my fear of spending regret. It took longer than I care to admit to suck it up, buy a new system, and make my work life immensely easier.
I realised that both my fear of spending regret and my fear of losing my job came down to one major worry: not having enough money. To really conquer that fear, I had to understand where it came from, and then meant figuring out my relationship with money. Valerie Golden, a psychology professor at Columbia explains:
If your feelings about money are screaming out for help, they may be drowning out your ability to even hear financial information objectively, and that may set you on a collision course for the future. Rather than allowing the train wreck to happen, think about your earliest memories of money, how it was handled in your family of origin, what it "means" to you at present, how it manifests in feelings about your life goals and yourself…
For me, money didn't represent opportunities or freedom. It was a source of worry, as I always associated it with not having enough. Once I understood how money motivated me, it became a lot easier to get over that fear. By recognising it, I could manage it. Whenever I made a financial decision, I asked whether it was solely motivated by that worry. If it was, I reassessed the decision objectively.
But spending regret is still something I consider. I wouldn't call it a "fear" these days, but I'm still wary of it, because it's just so easy to overspend. Balancing the two comes down to developing some conscious spending habits. For example:
- I put a dollar limit on indecision.
- I focus more on my financial goals than my budget. As long as I can reach my retirement and savings goals, I'm happy, and I try not to overthink the rest of my spending decisions.
- For big purchases, I try to err on the side of the Comfort Principle: I spend my money where I spend my time.
Because I'm a frugal person, it's hard for me to spend money in certain areas. But I have my weaknesses, too, which is why I'm wary of overspending to begin with. Recognising my weaknesses, learning how I'm motivated by money, and adopting a few guidelines for conscious spending has helped me keep that fear in check.
Investing Intimidated Me
A lot of people are afraid of investing because they think it's like playing the lottery. I, like others, just thought it seemed intimidating, confusing, and beyond my abilities.
I've always been a very frugal person, but saving money is only one part of building wealth. And it's not even the most important part. If you really want to build wealth, couponing isn't going to cut it. You have to increase the money you have coming in, and investing is part of doing that. After I paid off my debts and saved for an emergency, investing became hard to ignore.
I knew saving for retirement was important, and I knew it was best to take advantage of the power of compound interest while I was young. And I couldn't take advantage of it without investing. So gradually, I got started:
The learning process was gradual, but most of it falls into one of those three general steps. The point is, I learned how it all works, and I got started and learned along the way, too. The more I learned, the more I got over my fear. Soon enough, I realised it's not that intimidating at all; it's actually pretty simple.
Fear works sometimes. I was afraid of losing my job, so I worked hard. I was afraid of overspending and losing my money, so I did a good job of saving it. But after it serves its purpose, that fear can also get in the way and hold you back. Once I recognised what scared me most financially, I could work past it and take risks, and those risks have all been well worth it.