Tag Archives: Financial Fear

Financial Unmanageability Transcends Money

I believe that financial unmanageability transcends money.  When it comes to finding ways to better manage your finances, there are unlimited resources.  There are many great books, blogs, forums, websites, and apps.  There is not a shortage of information, tools, or even professional services.  If a person wants to make improvements when it comes to spending less, paying down debt, saving more of their earnings, or learning to invest, they could find out how to do it in a matter of minutes by doing a few simple online searches.

If the solution to finding ways to improve your financial situation is so readily available, why are so many people struggling?  Yes, we can blame the marketers for always trying to sell the newest gadget.  That excuse, however, only carries so much weight.  Consumers are more educated than ever and many tune ads out.

What if the problem is more pervasive?  What if the problem is beyond simple behavior modification? What if the problem is based on unmanageability?  Yes, the inability to have mastery over your life.

If the problem is based in unmanageability, there is not a blog or app to solve the problem.  If your life is truly unmanageable, trying to get a better handle on your financial shortcomings is just treating a symptom.  To gain control of your life, it will take a little more than spending less and saving more.

Denial

Nobody truly wants to admit their life is unmanageable.  Just like nobody wants to admit they drink, spend, eat, or gamble too much.  It is natural for many people to think, I don’t have an issue with my finances and then go spend more money.  It is common behavior for people who have addiction problems or a spiritual malady to deny what the problem is.  The thought process is like a broken record that skips the same verse over and over.  I do not have a problem with my finances – go spend more money.

Resentment

To resent is to keep going back to a negative feeling.  Instead of feeling and processing those bad or negative feelings, you spend money.  Resentment is not always based on harboring ill feeling towards someone who you believe wronged you in some way.  Resentment can also be rooted in harboring ill feelings towards someone who did exactly what you expected them to do.  The problem was that you were still not satisfied.  They were unable to fill that void that exists within you.  To find temporary relief, you continue to spend and try to fill that void with an external fix.  Unfortunately, it does not last.  After you exhale out and feel relief, you almost immediately inhale the resentment back in.

It is All About You

When you live an unmanageable life, there will always be a conflict with self.  It is all about you.  You cannot be of real use to others.  Sure, you might be physically present in their life, but are you truly living in the moment?  Or are you just physically there, but mentally bound to your troubles?  When your self-centered thoughts and feelings are the focus of your existence, it is difficult to make meaningful connections with others.

Anxiety 

You are not a bad person.  You might even do nice things for others.  You believe that you are thoughtful and caring.  You spend money on the people you care about and on those who you want to care about you. Externally that all might be true, but aren’t you just doing all those things to find more relief and to feel better about your current state of unmanageability?

Do you live in fear?  Do you spend more than you earn and panic when the bills arrive?  Do you lay awake at night and worry that you will never be able to get out from under all the debt you are in?  Do you see retirement as a possible option for others, but something that you would never be able to afford?  Do you obsess over your finances in one thought, but follow it up with more spending that pushes you further away from having healthy finances?  Do you feel hopeless?

Is this fear leading to other health concerns?  Is it leading to weight gain or panic attacks?  Have you gone to see your doctor because you feel overwhelmed?  Did your doctor put you on meds to take the edge off and to help you cope?

There is a Solution

Yes, getting your finances in order is great, but you first need to get your mind right.  I am not a therapist.  I am just a guy with a personal finance blog.  If you are honesty suffering from the symptoms that I listed above, you should seek outside help.  Find out if your health insurance covers visits to a psychologist without a referral from your primary care doctor.  If not, ask your doctor for a referral to one that they recommend.  You might have to pay a low co-pay, but it will be worth it.

There are also 12-step programs.  As I stated earlier, your spending might be just a symptom of a larger issue.  There are 12-step programs for spending, gambling, drinking, and just about any other type of obsessive disease.  It is up to you to dig deeper and decide if you think a 12-step solution would be a good fit for you.

Conclusion

Don’t beat yourself up.  Don’t wallow in guilt, shame, remorse, or any other negative feeling.  The past is the past.  It is time to move on.  Pick up the pieces.  You are not a bad person.  You might have made poor decisions and you might suffer from the disease of addiction.  After you put your own house back in order, you can make amends to those you feel you might have harmed including yourself.

There is hope.  There is also help available.  It is now up to you to find the right help that will be a catalyst for positive change.

Once you get your mind right, great things will start to happen in your life.  Not only will your financial situation improve, but every area of your life will get better.  How could it not, you will be moving away from the problem and in the solution.

You will be able to better accept people and situations as they are.  You will be able to let go of the past. You will better assimilate into the mainstream of life.  You will become more useful to the people around you.  You will finally find the peace that you have been searching for all along.

As a bonus, you should be able to better budget and save money.  Your whole life will become more manageable.  Having a few more bucks in the bank will just make life more enjoyable.

This post might contain affiliate links.

Please be sure to read the Disclaimer page.

An Abundance Mindset

An abundance mindset is the opposite of a scarcity mindset.  A scarcity mindset is one where a person is consumed by fear, desperation, and self-centeredness due to the obsession with not having enough resources to live and thrive.  An abundance mindset is a mindset where a person feels that there are enough resources and opportunities for everyone to succeed and live a fulfilling life.

There are many things in life that we do not have control over.  We do not get to pick our parents, how we were raised, or what resources were available to us as children including nurturing, food, medicine or education.  As adults, however, we do have the power to make the decision as to how we think and react towards every situation.

Our ability to think and how we view situations is a powerful tool.  It is critical to developing a healthy perspective if we want to be successful in life.  Just as negativity attracts negativity, positivity attracts positivity.

I am not referring to a Pollyanna mindset.  Nor am I referring to faking your positivity to the extent where it is transparent and the people around you just label you a phony.  I am referred to a hopeful mindset.  A mindset that will allow you to be happy, help people, and expand your horizons.  The best mindset to have to achieve all of those goals is to develop an abundance mindset.

Honesty

Honesty is a resource that we cannot have too much of.  Many people think of honesty as not telling lies or taking something that does not belong to them.  Yes, you should always be truthful and not steal.  In this context, I am referring to gut-level honesty.  This is the type of honesty that will allow you to be true to yourself and not fall victim to a scarcity mindset.

Do you have self-respect and value who you are as an individual?  Do you accept your current lot in life as a starting point for what’s next?  Do you have personal, professional, and financial goals that you are currently working on?  A person who can answer yes to those questions is highly likely to have an abundance mindset.

Fear

There is positive fear that tells you to look both ways before walking across a busy intersection.  There are also negative fears.  Scarcity is a negative fear.  Scarcity is negative because it consumes you and holds you back from taking the calculated risks that are needed to succeed.

A person who has an abundance mindset is sure to feel fear along the way.  To overcome that fear, they take hold of the steering wheel.  They do not let their emotions hold them back.  They pick up the ball and run with it.  They might fail.  They might fail more than once.  They might never succeed, but it will not be due to the lack of not trying because fear held them back.

Esteem

Many people in society have a scarcity mindset.  They live in fear to some extent.  They are afraid to take risks because they might lose their positions, money, or some other sense of security.

People who have an abundance mindset have high self-esteem.  They have to have healthy self-esteem because they are aware that they are different from other people.  Nobody generally likes feeling different from their fellows.   It does not, however, seem to bother these people who have an abundance mindset because they embrace their difference by moving forward towards their next success.  They do so while those with a scarcity mindset sit back and wallow in fear or envoy.

Comfort

Those who have an abundance mindset often appear cool.  They display grace under pressure.  They wear life like a loose fitting garment.  They are comfortable in their own skin.

There is a reason for their aura.  Don’t confuse it with being blasé.  They are in competition, but not with other people.   They generally see people more as conduits than threats. They are in competition, but it is based on winning by executing a plan.  They do not harbor negative feelings towards their competition.

If it is a competition between two people and they do not win, they humbly congratulate the victor.  They do not fall prey to resentment.   A person who has an abundance mindset is grateful for the challenge and for the opportunity. They feel that there are other opportunities for everybody to succeed and move on to the next challenge.  They have a growth mindset and will diligently prepare to do better when the next opportunity presents itself.

Big Picture

People who have an abundance mindset do not settle.  They think big.  They focus on the long-term.  That is why they are successful investors.  Where a person might cower at the thought of volatility, a person who has an abundance mindset does not fall victim to shortsightedness. They have above average emotional intelligence.  They know that change is constant and embrace it.  When others are selling low, they are looking to buy value.

Conclusion

It is rare to find people who have an abundance mindset.  Unlike unicorns, they do exist.  There might not be any in your inner-circle, but I can tell you where to find them.  They can be easily found online.  They gather on blogs and on forums.  There is a whole community of these folks who are working on achieving financial independence by embracing an abundance mindset as well as empowering others to do the same by sharing their stories.

These folks come from many different walks of life and can be found at different stages of the journey. Some are just starting out in their careers and working on eliminating debt.  Some are millionaires by mid-career.  Others are multi-millionaires and retired while they were still young enough to live out all of their dreams.  If you want to meet some of these folks, check out my Resources Page.  I hope you get to meet some of them and take advantage of what they freely have to offer you.

This post might contain affiliate links.

Please be sure to read the Disclaimer page.

The Scarcity Mindset

Even though you are doing your best to actively manage your finances, do you ever think that you might not have enough money to pay all of your bills, enjoy life, and save for a meaningful retirement?  Do you feel lonely, isolated, or even terminally unique?  Do you make financial decisions out of fear?  Does the thought of early retirement and drawing down your assets make you feel like panicking?  Do you project about the future and only see things getting worse?  If you do, you might have a Scarcity Mindset.

Living in Fear

If you have ever studied Economics, you learned that Economics is the study of limited resources.  The Scarcity Mindset is rooted in the fear of not having enough.  The scarcity mindset manifests itself in extreme self-centeredness.  It is based on an obsession with not having enough resources to meet both your needs and your wants.  No matter what course of action a person takes who has a Scarcity Mindset, the glass always appears to be half-empty.

Why do people have a Scarcity Mindset

People who have a Scarcity Mindset are focused on loss aversion.  Many people who have this mindset were once underprivileged or are currently struggling financially.  Everyone has limited cognitive space in their brain.  People who have the scarcity mindset have unmet needs.  These unmet needs cause the brain to focus on these deficits instead of focusing on the tasks that are at hand.  It is not based on a lack of intelligence, but a constant interruption in the flow of thoughts.

Short-term thinking

The Scarcity Mindset causes one to focus on the short-term.  It draws attention to the urgent.  A sell-off in the stock market would cause a person who has a Scarcity Mindset to panic and sell low because the recent loss will wipe out their finances.  They lack the foresight to see the correction as a short-term blip on the radar.  People who are stuck in this mindset also think that current situations will never change or improve.

Mentally Draining

The consistent mental obsession with not having enough rapidly drains the brains battery.  The focus on scarcity is mentally exhausting.  The brains finite mental resources are always in a state of debating trade-offs.  For example, it is exhausting to debate if you will have enough money to cover future expenses.  It is a mental debate that can occupy a person’s whole day.  The Scarcity Mindset truly is a form of suffering.  Other decisions become clouded because of this mental fatigue.  Because of this lack of mental energy, people are more prone to make poor decisions since their mental debates can lead to irrational solutions.

Symptoms

The symptoms tied to having a Scarcity Mindset are easy to identify in your life.  Hoarding things because of the fear of running out is a major symptom of the Scarcity Mindset.  Complaining about your general living situations is another symptom because there is a lack of satisfaction in your life.  Living in chaos as the result of people pleasing, addiction, lack of production, or self-deprivation.

Barrier to Wealth

Having a Scarcity Mindset is a barrier to building wealth.  If your mind is consistently producing a negative message, it is difficult to make positive financial strides in your life.  To succeed as an investor, you need to be able to think long-term and can handle some degree of short-term market risk and uncertainty.  If you panic based on daily volatility, it will not be good for your investment returns and only add to your mental anguish.

How to Change the Scarcity Mindset

The Scarcity Mindset is all in your head.  It is not easy to break away from this mindset.  It is possible, however, if you are willing to work on changing your thought process.

  • Write a list of everything in life you are grateful for. This list should include everything including food, housing, health, friends, family, and work.  If it is a source of gratitude, add it to the list.  Review this list at least once per day and more often if you are feeling negative.
  • Don’t compare how you feel too how others are living. Don’t compare yourself to others on any level.  Don’t try to keep up with neighbors, friends, or siblings. Live your own life.
  • Build your self-esteem through positive actions. Take a class. Volunteer to help people who are in worse financial or physical shape than you are. Take on extra responsibilities at work.
  • Focus on the present moment. Don’t project into the future where there is fear.  Don’t rewind to the past to feel resentments.  Keep your mind focused on what is currently in front of you.  Refocus as many times as you need to during the day.
  • Look at setbacks as a learning experience. Repeating the same mistakes, but expecting different results is a sign of insanity.  When you make an error, learn from it.  Try a different approach when faced with a similar situation.
  • Build closer friendships. If you want to gain a friend, becoming a better friend.  People are not going to come looking for you.  It is up to you extend your hand and keep reaching out to others.
  • Avoid negativity. Avoid the political and financial media.  There are great things happening in the world.  You just will not find information about those things in the media because they do not sell.  Check out this blog’s Resources Page for unlimited positive blogs, forums, and podcasts.
  • Reduce clutter and add order to your life. Embrace minimalism.  If you own things that you no longer use, give them away.  Whatever those things might be, they might be more useful to others.  Some examples are old books, clothes, sporting goods, or electronics.

Conclusion

Don’t beat yourself up if you feel you have a Scarcity Mindset or some of the symptoms.  The good news is that you can change this mindset.  It will take time and effort, but you can do it.  If none of the above suggestions are helping, seek professional help from a therapist.  After you break away from the Scarcity Mindset, you can start working on developing an Abundance mindset.  That is when life starts to become more of an adventure than an obsessive based existence.

Do you feel that you have a Scarcity Mindset?

What are some of the steps that you have taken to change how you think?