Fear and money – these are two factors that go hand in hand with each other. Without money, you’ll live in fear. Where will you get your next food? How are you going to survive? It’s also possible that fearlessness can be rooted from lack of money. You’ve discarded your fear to gain the income that you deserve. If you want to become financially independent, then you have to let go your fear of money. More importantly, you have to deal with certain financial risks down the road.
Listed below are some of the habits that’ll remove your fears about money:
It’s always better to create a detailed financial plan. We usually approach budgeting on a month-to-month or annual basis, but in reality we’re constantly rolling over from previous time periods. In order to understand your fear of running out of money, it’s a good idea to start fresh. For one month, from the 1st to the 31st, track every dollar that came in and every dollar that went out. At the end of the month, examine the numbers. Have you ended up in a better financial position or not?
Determine Your Financial Problem
If you’re worried about making ends meet, you have a major financial problem. Even if you got to the end of the month and had money to spare, the fact that you’re worried indicates a problem. You have a monthly deficit. You spent more than you made. The month might have been an anomaly (one unexpected expense can do that), but generally ending the month in the red is a sign that your spending isn’t aligned with your earning. So either your income needs to increase, or you need to find a way to reduce your expenses. It might be a single big picture change (you’re spending too much on rent), or it might be a series of little tweaks. A deficit can be hard to close, but as long as you know what the problem is you can at least start working on a solution.
Breaking even is just slightly better than not reaching your financial goal. If you’re income is just enough to cover your expenses, that’s not an ideal situation. It means any unexpected or irregular expense can knock you off your budget. If your budget is that tight, you need to work on reducing your expenses wherever possible. You also need to start bulking up your emergency savings. A robust emergency fund gives you the ability to weather rough patches and should help relieve some of your monthly money stress.
Take Massive Action
Fear can cripple you into indecision. When you’re afraid it’s difficult to take action and conquer that fear, but that’s exactly what you need to do. If you’re afraid that you don’t have enough money to make ends meet, stop being afraid and start doing something about it.
Pro tip: you can also test your fear of money by taking out a loan. Apply for a credit builder loan and observe your repayment strategies. If you managed to repay your loan without troubles, then you just had one of your early financial victories.