4 Common Fears About Money To Overcome

Positive confident pretty businesswoman showing clipboard with agreement to phantom client in modern comfortable office.
mediaphotos / Getty Images

Most people share certain types of financial fears in common. Some will be able to overcome these fears with support, but others will let fear rule the rest of their lives. Leading a life where financial fears take top priority can keep you trapped in an unhealthy financial mindset. It can even lead to losing money throughout your lifetime.

Even if you feel scared to do it, it is possible to break the cycle and develop a healthy financial attitude where money is viewed as a tool that can help, not hinder, you. Here are some of the most common money fears and what it takes to overcome each one.

Fear of Going Broke

Let’s start with one of the most common financial fears: going broke or even bankrupt.

This is often a learned money belief or habit, said Chloe Elise, certified financial coach and CEO of Deeper Than Money. Typically, the person who holds this fear has observed it from their parents or grandparents.

“They look at money as always being scarce, and they fear they will run out,” Elise said. 

While this belief can be extremely difficult to break, the ultimate goal is to view money through an abundance mentality. Elise said some of her clients adopt the mantra “money flows to me” as a way to start welcoming money into their lives. 

Investing for Everyone

It takes more than a mantra though! To start welcoming money into your life is to watch your money work for you. Elise’s favorite recommendation for doing this is to keep your emergency fund in a high-yield savings account. 

“With total liquidity and no risk, a HYSA is an incredible way to begin to see interest accumulate on your account by doing nothing,” said Elise, who adds that as of right now interest rates are over 3%. 

Once you do this, Elise said you can start to look into other investments, like retirement accounts or real estate. This eases the fear of stepping outside of your comfort zone and increases the likelihood you will be rewarded.

Fear of Checking Your Bank Account

Who among us has indulged in an expensive weekend out, or a week-long vacation, and then felt paralyzed with fear about what their bank account will look like in the aftermath of these pending transactions? 

Here’s what happens when you don’t check your bank account today. You’re not likely to check it tomorrow or the day after. 

“What often happens is we let this feeling of guilt and shame from spending money spiral,” Elise said. Before long a month passes and you start to experience anxiety about facing your finances.

Investing for Everyone

To overcome this fear, Elise recommends planning as much in advance as possible. If you are going on vacation, Elise said you can create a bucket in your savings account specific to the trip.

“Ahead of the trip, you’ve already mentally prepared for that money being spent. It makes it easier to look at your bank account when you already have an idea of what it will look like,” Elise said.

Fear of Feeling Stupid

If you don’t understand how APRs work, the difference between a traditional or Roth IRA, or what a mutual fund is, there’s a good chance you’re not alone. Financial jargon can often sound difficult to comprehend, and Elise said this stems from the self-belief “I’m not good with money.”

“You might even think everyone’s got it figured out but you. Which in turn causes the fear of feeling stupid when it comes to finances.”

The fear of feeling stupid about finances leads to a domino effect of other fear-related behaviors which can impact your finances. If you fear feeling bad about your money knowledge, you will fear talking about money. If you fear talking about money, you cannot ask the questions you need to and get answers that advocate for yourself and increase your overall financial literacy.

Don’t let your fears keep you in the dark! You can coax yourself out into the light per Elise’s recommendation where you begin to have fun and light conversations about money with friends and family. 

Investing for Everyone

“Ask them if they use a bank or credit union, or what their financial goals are this year. This will increase your confidence about money and lessen the fear,” Elise said.

Fear of Failure

Stephanie Genkin, CFP and founder of My Financial Planner, recently worked with a client who earns a high salary but is still stressed about money. The client’s boyfriend offered a well-intentioned recommendation of setting aside six months’ worth of cash for emergencies.

While the advice was not necessarily wrong, Genkin’s client felt anxiety and inaction. She had growing credit card debt and only about a half-month of expenses in a savings account. 

Genkin spoke to the client about money. Gradually, the client opened up about her money beliefs and her family’s history with money. She agreed to automate a small amount of money into her online savings account to ensure that by the end of the year, she’d have at least a month and a half of expenses in savings. 

Genkin noticed the client went from anxious to excited. What changed? The client said she was overwhelmed by the six-month timeline and afraid to fail.

“I understood her challenges and encouraged her to do something small instead of trying to be perfect,” Genkin said. 

A lot of financial fear is about being less than perfect or having everything together, but it’s important not to let the fear of perfectionism take over your finances.

“Small, doable steps over time lead to big improvements,” Genkin said. “Allow yourself to be less than perfect. Slow and steady is good too.”

More From GOBankingRates

Investing for Everyone


See Today's Best
Banking Offers