Overcoming financial anxiety – Mental Health Awareness Week
This week (13-19 May 2019) is Mental Health Awareness Week. While body image is this year’s...
Fear can either have a positive or negative effect. Sometimes it can fuel bravery: your instincts – and even your survival instinct – kick in and help you out of a situation. At other times, we can let ourselves be caught up in a negative cycle of fear and find ourselves in a ‘‘paralysis by analysis” situation.
But as president Franklin D. Roosevelt said in his first inaugural address: “The only thing we have to fear is fear itself”.
So whatever your fear when it comes to investments – whether it is fear of failure, fear of not having enough money, fear of financial jargon, or another fear, there are a few different techniques you can use to help you move forward.
‘How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case.’ – Robert G. Allen, author and motivational speaker
It doesn’t matter if you have a fear of heights or fear of investing, the first thing to do is accept your fear. Don’t lie to yourself or make excuses. Cut the BS and be honest about it. Great, now we can actually make some progress.
Once you’ve confronted your fear, it’s time to understand why it exists in the first place.
For most people, the biggest investment fear is that you are putting your money at risk. We see the warning: “the value of your investment can fall as well as rise” all the time. And I get it. You’ve spent a lot of time, energy and more than likely skipped a night out or two to build your savings and you want to keep it in the bank where you know it’s safe. Nobody is going to say that’s irrational, it’s natural to want to protect something you worked so hard to get. But on the flip side, if you were a little bit braver, your pot of money could potentially grow even bigger.
Maybe you have a fear of not having enough money to even start investing. Again, I get it. But investing isn’t just for the rich. You can invest as little as £50 a month or £100 lump sum. And remember, in most cases, you still have access to your money should you really need it.
Or perhaps you’re like me and have a fear of being underprepared and won’t make a decision until you’ve read and researched every single thing on the subject. For reference, it took me over a week to decide on a new food for my dog and there weren’t nearly as many options as the 3,000 funds to choose from when investing! That’s why websites like this exist and series like our millennial money are so useful – they can help give you digestible ideas and information to help better inform your decisions.
Still not convinced? Consider talking to a professional adviser regarding your money woes and options when it comes to investing. It might just be the peace of mind you need to make the first step.
Don’t bite off more than you can chew when facing a fear. Despite my husband’s fear of heights he sometimes finds himself climbing cliffs because I want to take a picture. It doesn’t end well (he doesn’t fall of or anything, it’s just too much for him!). But the Ferris Wheel at Winter Wonderland? That I can get away with. Baby steps.
So try and do the same with your money. You don’t need to flip a switch and suddenly throw all your money into investments. Instead of putting £400 into savings each month, why not think about putting £100 into investments and £300 into cash? Get comfortable with the idea, and then try raising your payments to £150 and then £200 etc.
You’ll still feel the security of having your money in your bank account, while learning the ropes to investing. And if you fear stems from taking too big of a risk, start off with more cautious investments and, over time and with more confidence, consider moderate or more risky investments.
Don’t let Chrometophobia* get the best of you. Confront your fears. Be brave and start investing.
*a state of an exaggerated or intense fear of money. And yes, it’s a real thing.