Shocked stressed young woman reading document letter about debt
Few things are scarier for me than Stephen King, particularly his book and pursuant movie It. Thanks to them, I can never go near a clown again. There are also some scarier things that can haunt us day after day and night after night: our personal finances. Here are a few strategies to help you overcome your greatest money fears so that you can begin crushing your financial goals:
Fear #1: Losing control of your money
Budgeting can be scary. We don’t like having to track every penny or feeling bad about our spending, yet we feel terrible when we’re broke or are living paycheck to paycheck. It’s like staring at the face of failure and then looking up at an insurmountable mountain to overcome. Yikes!
Face that monster in 3 steps:
1) Start with “why?” Write down why being in control of your money is important to you. What will that allow you to accomplish and how would your life change? How would that feel? Establishing a strong enough “why” can give you the courage and motivation to begin the budgeting journey.
2) List out your expenses. I prefer the pen and paper approach as a starting point. If you prefer a spreadsheet, here’s a template, you can use. If you prefer something higher tech, then an app like Simplfi, Mint, or Pocketguard might do the trick . The most important thing is to pick the approach that’s easiest for you.
3) Identify opportunities to save. Comparison shop for bills like cable, wireless phone, and insurance. Eliminate expenses for things you don’t use or that don’t align with your why. You can check out additional ideas here.
Fear #2: Running out of money
Having your checking account go to zero is stressful. Then the unexpected happens and you’re left with a terrible decision to make between deciding which bill will go unpaid or pulling out your credit card. As we all know, the unexpected tends to happen pretty frequently.
Deal with this monster in 3 steps:
1) Build an emergency fund: Open a separate account for your emergency savings. A high yield savings or money market account is a great place to start. The purpose of this account is for true emergencies, not for the occasional travel expense or gift.
Make getting that account to $2,000 your #1 priority. Once you are there, continue to increase those savings towards 3-6 months of expenses while balancing your other …….