Follow these five steps to put an end to your financial fears

Financial fear, like a journey through a haunted mansion, might manifest itself in vague feelings that danger lies just around the corner.

These feelings tend to amp up when money pressures seem overwhelming. For many Canadians, that’s right now.

Fear not. To dispatch your financial bogeymen, take several deep breaths and read on:

Anchor yourself in why you’re wanting a better relationship with your finances

I call it a financial ‘why’ and the moment you have a good reason to improve the money situation in your life, it delivers sustained motivation you’ll need to do the work required.

Your ‘why’ is probably not going to be about money. It’s about what money enables you to do in life. For example, your reason could be to have a better life for your family or freedom to retire. Think about your true motivation. Write it down. Make it visible daily.

Money needs nurturing just like a romantic relationship

It isn’t something to be solved and then it’s done. Sure, tougher times will pass, and you’ll get through it, but money matters are not going away. The moment you can shift the energy that financial fear is consuming, toward a nurturing perspective, you will find immediate relief.

A common place to start is simply being willing to invest in learning about personal finances, and your financial picture. Blogs, vlogs, podcasts, books and more are readily available for next-to-nothing (especially if you use the library).

Nurturing your money also takes time.

At a minimum this is a monthly touchpoint or money date, but I’m a big fan of a weekly frequency especially as you’re working hard to get to a better place with your money. Some of my community members name these days “Finance Friday” or “Wealth Wednesday” or “Money Monday” (I do my check in on Saturdays while my little ones are napping).

What’s going to make this stick is blocking the time in your calendar. In your sessions, check on your budget, your online banking and investments and expand your knowledge.

Scrap the ‘evil’ narrative

Labelling money as ‘evil’ or ‘good’ or people that have it as ‘greedy’ or ‘happy’ is dangerous. The worst though is when you label yourself as being ‘bad with money’ or ‘terrible with numbers’. Labelling leads to accepting the status quo, when what we really want is to shift the status quo.

Money is just a tool used to buy and exchange goods and services. Believing that you can do better with your money, and that you can use it like a tool to help your life is when change can occur — and it helps to remove some of the emotions behind it.

Remember the tortoise and the hare story?

Be like the tortoise.

Slow and steady wins the financial security race. Frantically trying to fix your finances like the hare will leave you exhausted — and broke.

Approach saving, investing and debt reduction at a regular and manageable pace. I like this framework:

• Save for emergencies in a high-interest savings account;
• Save for big-ticket items in a regular savings account to help you avoid piling up credit card debt;
• Invest a fractional portion of each paycheque into work pensions, RRSPs and TFSAs to take advantage of the most tax efficient way to grow retirement savings;
• Chip away at debt and consider a consolidating line of credit or loan at a lower interest rate. The trick is to avoid accumulating more debt while dealing with this.

Working away at each of these areas will make a difference — as you keep a steady pace like the tortoise. Obviously, if you have increases in your household income over time, allocate more toward these healthy activities. Another helpful way to think about this is earmarking a few dollars a day for your well-being.

Don’t do this on your own

Your relationship with money is a journey best taken with financial friends. Online personal finance communities are booming right now and my advice is to join one, and also share your goals with friends and family who care about you.

If you’re ready to do more, hire a financial planner or money coach to assist you in building your financial plans.

Financial fears are less scary when you start looking at them clearly, and with the perspective that the more you build that nurturing relationship with your finances, the faster the fears morph into a healthy money mindset.