One of the things that many of the financial gurus tell you is necessary to reach financial freedom is to be able to free your mind from the fear and worry you feel about the future. It would be nice if we could control our future, but its very difficult to do because of all of the unknowns and external factors. Without control, comes uncertainty. With uncertainty, often comes fear and worry.
The realities of adult life have left me with more responsibilities than I originally knew I signed up for, and it makes it rather difficult to find peace. Nonetheless, I am finding inspiration and making much more conscious decisions with my money and choices since I started this blog. In order to confront my largest fears, and give myself a chance to push past them, I’m documenting them below.
My 2 Financial Fears
Here are my greatest financial fears around making a dramatic life-changing choice that I want to do, but tell myself is foolish: ‘what if I were to drop everything, reduce or stop paying some of my obligations and responsibilities, be with my daughter more and pursue an entirely entrepreneurial career’:
- Fear #1 – I would hurt my credit score. I’m not actually afraid of the concept of foreclosing on a mortgage or losing my house. I know that I will always have the means, family and friends if we ever needed somewhere to live. I am afraid of the long-term implications of running out of money and impacting your credit score. I don’t want a short period of time in my financial life to affect my ability to borrow and get ahead in the world. So, there it is, this very realistic fear is what I believe cripples many people into paying down their debts before taking care of their true desires and their dreams. The fear of breaking the rules of the system stop many of us from doing what we truly want to do with our lives.
- Fear #2 – I would lose my health insurance coverage. This year, we switched from my company’s HMO to the HDHP because of costs. Though it may sound nice, it really is bothering me already. My husband is avoiding going to the doctor for something, even though we pay hundreds a month for health insurance, because we don’t want to pay another $150 out of pocket with the risk that he will have a virus and not be given any medication anyway. HSA’s definitely do force you to think twice about going to the doctor, but this may not always be a good thing when you are ill. I am interested in looking into alternative and more preventative health and nutrition options, such as eastern practices, certain foods and herbs, etc, but sometimes you need American medicine and care. Many American’s are literally losing everything because of their health expenses. I had a client tell me that she was going bankrupt because of her medical bills. She was previously a very successful, wealthy woman. What has this world come to? I’m sure many people feel the same way, and I’m not certain if it will actually get better with the changes they are making D.C. I would be afraid to have another child because of the costs that I would incur in medical bills if I didn’t have health insurance coverage. And even then, it costs thousands to add a person to your family (unless you are really poor and can get help from the government).
That’s about it. Those are the two scariest things for me. I’m pretty sure I could live in a trailer, and eat cheaply for a while if it meant that I was able to spend time with my daughter and pursue my dreams. But I am afraid of the immediate implications, and because of this, I currently have to make a choice to take things slower than I want to. Ah well, baby steps are better than no steps at all. My life is run by the rules of taxes, debt and inflation.
What About the Fear Driven “Emergency Fund”?
I’ve been reading a lot that most people recommend having 6-8 months of expenses saved before you ever do anything dramatic such as pursue an entrepreneurial endeavor. (We have a small one, about 2 months bills worth). The part of this concept that I struggle with is that the premise of this fund is based on fear. It may be a justified fear, but it is still a fear nonetheless. Will you be thankful that you had this fund set aside in times of need? Quite possibly. Yet there is also the flip side in which you may not take the necessary steps that you want to take with your life, because you are so consumed with a fear of the unknown and of having enough to pay your bills. Maybe a well-educated investor would at least put some of this contingency money into a somewhat liquid, but higher paying asset. Or diversify in multiple types of assets. Or spend in on your business venture that you want to start…? As Americans, the only way to get out of a recession/depression is to face our fears, and start doing, not just saving.
So, here’s my thought for anyone feeling afraid, desperate, or just plain stuck (a word I am very much trying to get out of my vocabulary, yet there it is again): Acknowledge your fears, but do something anyway. Nothing dramatic, just something. Read a new book, try something new. Turn off the TV and sit down and write about what it is you want, your goals and your dreams. Focus on what you want, to the point where you can visualize and see it, and you will start to set the forces in motion for change. Change doesn’t always happen quickly, but it does happen.
What are your greatest financial fears? Do you think they are based on reality or possibly just in your head?
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