3 Tips to Overcome Your Fear of Spending Money - Molen & Associates

Stay Ahead of Law Changes & Protect Yourself Against Being Audited: Corporate Transparency Act and Reasonable Compensation

3 Tips to Overcome Your Fear of Spending Money

There are times when we pinch pennies or even save to the extreme and then there are those that have developed a fear of spending their money. This fear is probably based off of a past experience when someone had no access to funds and because of poor budgeting or lack of income they were put in a dire situation. You don’t have to live in fear of never spending your money and with these three tips you can be on your way to finding peace of mind in your ability to spend and save.

How do I get over my fear of spending money?

There is a word for the extreme fear of money – chrometophobia. It may derive from the fear of financial failures or just thinking about the responsibility that money brings. Luckily, there are ways for you to face that fear head on and think about your finances proactively.

The first tip is to make time to think about your finances every day as part of your self-care routine. Creating a plan with achievable goals will begin easing your financial fears along with helping you to see a broader perspective when it comes to your money. You can begin with planning a budget, reviewing your bank statements, and making a detailed savings and spending plan. Take time to figure out what you can afford reasonably without putting yourself in a financial strain. Rely on those that you trust to give you some of their wisdom on how they are able to keep their monies on track. You can talk with your family or even meet with your advisor to discuss your money anxieties. Taking these steps and focus on the progress you are making each day, week, or month. Look at whether you increased your savings last month, even if it is just a minute amount, every little bit counts.

When creating your budget make sure to plan for an emergency fund and are saving for your future self, aka retirement. Not sure how much to contribute to your retirement ? It all comes down to your age and what you feel comfortable doing with your money. Again, meet with a financial expert who is knowledgeable about your financial situation and can help you determine the best decisions for you.

Why do I get anxiety when I spend money?

Feeling some anxiety about money is common but if it is persistent, your spending habits and overall finances need attention. To prevent anxiety try to focus on the below:

  • IDENTIFY YOUR VALUES

Before thinking about all the things you could spend your money on and panicking because of how much they might cost, start by evaluating your finances. Figure out how much you earn, how much you spend (and on what), how much you save, and what you donate or give to charity. Then focus on identifying your values and what makes you happiest.

Write down your short-, medium- and long-term goals in detail and then rank them of importance. An easy way to think about this is to choose experiences over things. One tends to lose interest in things soon after acquiring them but memories of a trip, for instance, will last for years. Doing something you love tends to bring more enjoyment than buying something.

  • PRIORITIZE YOUR SPENDING

The goal is to enjoy spending your money now in ways that will not feel frivolous in the long term. Think of a long-term goal that will bring you joy and see if your current actions prevent you from reaching that goal. If so, skip it and save your money. Spend money in ways that support your pursuit of that goal. Remember to look at the big picture and evaluate each transaction as a want or a need. Don’t be a spontaneous buyer only to dread your purchase later.  Contemplate each desire to purchase at least 3 times before making that final go. 9 out of 10 times you will find that you don’t actually need what you initially wanted to buy and by giving yourself time to think, you’ve made a decision out of wisdom rather than frivolity.

  • DIVERSIFY YOUR INCOME

Anxiety about spending money can stem from a lack of stability in your income. If you depend on clients or commission for a consistent paycheck, it can be hard to justify spending money on things that feel frivolous or self-indulgent, like relaxation and travel.

While you need a certain amount of money to save and pay your bills, your ability to earn more money has no limits. Try getting a side job. If your day job pays enough to cover your bills, put your side job directly into a “fun money” account for travel, nice dinners, a savings goal, or whatever else helps you enjoy life.

You will not only have fun money but also a way to diversify your income. If you lost your main source of income, you have another income stream to help you through.

Another example is that you could find ways to make money like take your used clothes to a consignment shop instead of Goodwill or sell them on eBay.  Get rid of unused furniture or offer services like babysitting, yard mowing, or anything that can help your grow your income instead of spending it. While these ideas are probably not a steady income stream you are giving yourself an opportunity to create more income. If you have more time, focus on developing a consistent side job.

TO SUM IT UP

Is it really all about money? Some people equate spending money with happiness, but that is  not always the case. If you work a lot and make more than enough money to do what you please, you may want to consider taking a step back and spending some of your time. Think about a cause that means a lot to you and spend some of your time helping out. Offer your skills to a cause, and be open to whatever they want you to do. Your time is money, and giving back in this way can have innumerable benefits for both you and your cause.

There is no reason to deny yourself happiness because you are constantly anxious about money.  Focus on reducing debt and saving and allow yourself to have some fun. Try not to be paralyzed by money fears.

By determining what is important to you and working your way to those goals, you can enjoy life and take care of your future at the same time. Anxiety over spending is frustrating and sometimes even debilitating. Learning to deal with this anxiety can help you practice better money management, clean up your credit, and set and achieve financial goals. Taking steps to address the cause, not just the symptoms of your anxiety can help you lead a happier life.

If you need any guidance regarding your financial situation give us a call. At Molen and Associates we pride ourselves in educating our clients, building your financial vision, and work with you to plan out your best and most successful future.

 

https://thephysicianphilosopher.com/fear-of-spending-money/

https://www.debtfreedr.com/fear-of-spending-money/

https://blog.mint.com/trends/what-does-fear-of-spending-really-mean-0413/

https://www.fearof.net/fear-of-money-phobia-chrometophobia-or-chrematophobia/

https://www.findjoy.com/2018/11/19/how-i-got-over-my-fear-of-spending-money/

 

 

The Molen & Associates Difference

Mike Forsyth

“Super helpful and timely. This is our first year with them and we look forward to trusting them with our taxes and business books for years to come.”

Caitlin Daulong

“Molen & Associates is amazing! They run an incredibly streamlined process, which makes filing taxes a breeze. So impressed with their attention to detail, organization, and swift execution every year. Cannot recommend them enough!”

Sy Sahrai

“I’ve been with Mr. Molen’s company for few years and I felt treated like family respect and dignity. They are caring, professional and honest, which hard to find these days. Love working with them.”

Gig Economy Taxation: a Detailed Overview

Gig Economy Taxation: a Detailed Overview Reporting Income as a Gig Worker Gig economy workers must report all income earned from their endeavors. This includes, but is not limited to: Earnings from part-time, temporary, or side gigs. Income not reported on...

Standard Deduction vs. Itemizing: A Comprehensive Guide for Small Business Owners and Self-Employed Individuals

Standard Deduction vs. Itemizing: A Comprehensive Guide for Small Business Owners and Self-Employed Individuals   As tax season approaches, one of the most significant decisions you’ll face as a small business owner or self-employed individual is whether to take...

Real Estate and Taxes: A Comprehensive Guide

Real Estate and Taxes: A Comprehensive Guide Real estate taxation is a multifaceted topic that encompasses various forms of taxes, including income tax, property tax, and sometimes even sales tax. Whether you’re dealing with personal or business real estate,...

Steps to Filing a Tax Extension

Is Filing an Extension Bad?   We get this question probably a thousand times a year. An extension is not inherently bad, it is truly personal preference. An extension will not increase your risk for an audit or red flag your return with the IRS. In fact, it is...

How to Pay Your Child From Your Business

How To Pay Your Children From Your Business Paying your children through your business can be a strategic way to manage your business's taxable income, while also providing your children with income and potentially teaching them about the value of work.  While it is a...

Tax Tips for Newlyweds

Tax & Financial Tips for Newlyweds in Houston Marriage is a significant milestone that not only unites two individuals in partnership, but in most cases, also merges their financial and tax situations. For newlyweds in Houston, understanding the tax implications...

Self-Employment Taxes: A Deeper Dive

Self-Employment Taxes: A Deeper Dive Self-employment taxes are a critical component of the tax system in the United States, impacting individuals who work for themselves. Understanding the nuances of these taxes can help self-employed individuals plan and manage their...

Education Tax Benefits: Maximizing Savings with Credits and Deductions

Education Tax Benefits: Maximizing Savings with Credits and Deductions Navigating the complexities of tax season can be daunting, but for those bearing the costs of higher education, there are valuable tax benefits that can ease the financial burden. Among these are...

How to request Individual Penalty Abatement

How to Request Penalty Abatement Penalty abatement is a great way to help reduce your client's tax debt. Here's how you can request apenalty abatement from the IRS. Let’s say you’ve determined that your client is eligible for a penalty abatement to help reduce their...

Understanding the Child Tax Credit for 2023

Understanding the Child Tax Credit for 2023 The Child Tax Credit (CTC) is a significant provision in the U.S. tax code designed to offer financial relief to families with qualifying children. As we navigate the 2023 tax year, it’s crucial to understand the current...

Request an Appointment Today

10 + 5 =

Call us at

Pin It on Pinterest

Share This