4 Financial Weaknesses and Ways To Grow From Them

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How do you know if you have a financial weakness?

Some are a bit more obvious than others, like a monthly credit card statement showing many purchases that are classified as wants rather than needs. Other financial weaknesses are less obvious, such as procrastinating on repaying debt or saving for retirement. What every financial weakness has in common is it hinders your financial health.

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The good news is once you figure out what your financial weaknesses are, you can take the steps necessary to overcome them.

Common Financial Weaknesses

Financial weaknesses take on many forms, but you may not fully recognize certain types. Here are a few common, and less common, financial weaknesses.

Retail Therapy

If you have a bad day, you might try to turn the day around with a trip to your favorite store or an online shopping spree. Upon checkout, you may have made tons of purchases and have a couple hundred dollars freshly charged on your credit card.

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Did you have enough money in your budget for spontaneous shopping? How do you think you will feel in a few hours from now? Will you be happy with all these unplanned purchases, or suffer buyer’s remorse?

When we shop in the hopes of making ourselves happier, we’re engaging in retail therapy. It’s a pretty common spending habit, but it can also be a dangerous one. 

Mark Woodbury, financial consultant and co-founder of Minerva Equity, said the moment retail therapy becomes a financial red flag is when you start to disregard other financial responsibilities. Retail therapy, Woodbury said, does offer momentary bliss, but this fleeting bliss is at the cost of financial security. If you neglect this financial weakness, you may continue to impulse buy and overspend. 

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Overspending

Simply put, if you spend more money than you can afford to, you’re suffering from overspending as your financial weakness. 

Wealth expansion coach Jamie Sea said there are a few reasons why overspending may creep up as a bad financial behavior. One of the most frequent reasons is because a person does not feel safe building wealth. 

“When you have behaviors of distrust around spending, you may now identify as someone who is unable to build wealth on a subconscious level,” said Sea. “This means even if someone wants or desires to save more, it will feel almost impossible for them to do so until they identify as someone who can feel safe trusting themselves with their spending habits.”

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Avoidance

How do you feel about looking directly at your bank account balance? Do you feel nervous or concerned about what you’ll find? Are you trying to find a way to avoid doing it? 

Those who have avoidance as their financial weakness, Sea said, will be afraid to look at their bank account. Why? They don’t want to see something, like a balance in the red or lack of funds, which makes them feel uncomfortable. 

Hoarding Money

You might think it’s a good thing to hold onto money, especially in the current economic climate. The reality is there’s a difference between being mindful of your finances and hoarding money.

In a situation where you’re hoarding money, Sea said a person may have concerns rooting from a lack of control. Sea uses the example of a person who sees more money in their bank account. This eases their nervous system because there’s a visible safety net.

Hoarding money can also stem from lack of trust. Sea uses the example of someone using the thought process, “If I spend money, how do I know it will come back?”

How To Overcome These Weaknesses

Here are a few quick practices for overcoming these financial weaknesses. Try each out as you need it and see which works best for you.

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Retail Therapy: Wait It Out

Don’t immediately give in to a shopping spree. Woodbury recommends waiting a day or two before making a purchase. 

“After this waiting period, ask yourself if you still want the item as badly as you did previously. If the answer is no, then you have successfully just avoided an impulsive buy,” he said.

Overspending: Create Awareness

Sea recommends those struggling with overspending start a journal or spreadsheet for their spending habits. Each time you want to spend on wants instead of needs, take a moment to pause and write about it. Ask, and answer these three questions, per Sea’s recommendation:

  • What am I spending for?
  • Is there a need that isn’t being met currently?
  • What do I desire to feel by purchasing this?

Avoidance: Give Your Bank Account a Pep Talk

If you struggle with viewing your bank account, Sea recommends making daily visits to your account and looking at your balance. While you’re there, no matter what you see, repeat the following mantra:

“I can’t wait to watch us grow together! No matter what, I know that we will. I know you will take care of me and I will take care of you! Regardless of what you show me, I know I am secure, safe, and grounded.”

Hoarding Money: Words of Affirmation

Improving upon hoarding money usually requires some words of affirmation. Sea recommends affirmations such as:

  • Money I spend comes back to me tenfold! 
  • I am safe to spend and receive freely! 
  • Money shows up for me in expected and unexpected ways!

“These affirmations will help you feel secure and safe as money ebbs and flows,” said Sea.

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About the Author

Heather Taylor is a senior finance writer for GOBankingRates. She is also the head writer and brand mascot enthusiast for PopIcon, Advertising Week’s blog dedicated to brand mascots. She has been published on HelloGiggles, Business Insider, The Story Exchange, Brit + Co, Thrive Global, and more media outlets. 

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