4 Steps to Overcome Financial Fear and Take Control of Financial Freedom

It was a beautiful, crisp spring morning. I was en route to the health club for my Thursday morning swim. As I made my way down the road, I could feel my shoulders starting to stiffen and my hand clenching the steering wheel ever tighter. Usually the thought of entering the pool is calming, but CNBC’s morning reports had trumped that.

There is a lot of financial noise and constant dissension about overheated stock markets and a bursting bond bubble. It is no wonder that many of us are walking around with feelings of financial dread. Although these feelings are understandable, we cannot let them paralyze us and keep us from acting in our own best interests. So what is a person to do?

First, face your financial fears. Take some time and make a list of what is causing you to be anxious and fearful. Is it the economy, your job stability, investment account balances, your children’s education funds, or the amount of debt you are carrying? Try to be specific and detailed in your concerns.

Now study that list very carefully — is there anything on that list that you can do something about?

Second, take action. Create a budget that paints a clear picture of your income and expenses. Remember that the basic rules of personal financial planning remain the same regardless of the economic environment. Whether the economy is good or bad, you should live within your means, save the difference in an emergency fund and retirement fund, and pay down debt. If your house payments are overwhelming, then start the process of refinancing. If you are making just the minimum payments on your credit cards, call the company and work out a payment schedule that is feasible. Continually develop your employment skill set and update your resume.

Fear is the elephant in the room, and it will destroy the furnishings if ignored. Fear and inertia cause people to make irrational choices. By seeking out accurate information and relevant knowledge, on the other hand, you can take actions that will reduce your financial fears and put you in control.

Third, invest in planning. Part of moving on financially is coming up with a written financial plan. This serves as a compass when we become excessively exuberant or overly pessimistic. The plan should address not only your short-term financial goals but also your long-term objectives. It should detail a personal income statement and balance sheet. This presents an objective picture of where you are. The next step is determining where you want to go — financially speaking — and outlining the steps to get there.

By working with a financial advisor, you can gain an objective perspective on your financial “big picture.” Having a financial quarterback, someone with an educated and independent outlook, is worth its weight in gold. An advisor can help you work to enhance your financial plan via money management. Depending on their credentials, they may recommend specific investments, long-term investing strategies, insurance options, retirement planning, risk management methods, and more.

Sit down with the advisor and ask about their credentials, how they operate, and their years of experience. Be sure it is someone you feel comfortable with and that your personalities mesh. The right financial planner will help you determine both your short-term and long-term goals and help you develop an action plan to meet those goals. You can visit the Certified Financial Planners website to find a financial advisor with proven credentials in your area, or one who has a particular expertise.

Lastly, take care of your physical and mental health. Turn off the TV, walk your dog, or go for a swim. Communicate your fears to others close to you. Eat healthy foods and remember: This too shall pass.

By following your action plan, you can feel in control of your economic future and move from financial fear to financial freedom.

Loretta Hutchinson (CFP, CDFA) is a member of the DailyWorth Connect Program. Read more about the program here.

Insync Financial Group, LLC is a registered investment advisor