Top 3 Money Fears and How to Tackle Them

Many of us have stress in our day-to-day lives. But one of the most prevalent stressors is money.

Financial stress refers to a feeling of worry or anxiety over money, debt and various expenses.

In a recent Bacon & Heels survey, 63% of respondents said that they are most worried about paying off debt, saving for a rainy day and saving enough for retirement.

With a global pandemic, a potential recession looming, inflation and shrinkflation, it may feel overwhelming to manage debt and our finances.

BUT instead of focusing on the negative, read on to see how to tackle, and overcome, your money fears.

#1 Fear: Getting rid of credit card debt

Everyone has debt. Some debt like mortgage is often deemed as ‘good debt’ and ‘bad debt’ is usually credit card debt.
So how do you get started on tackling your credit card debt. First thing to do is take a good look at how much you owe.

Pull all of your credit card balances and arrange all of the balances from the lowest to the highest - I know it may be hard to look at, but knowing where you start. Then look at the interest rates.

Here’s how to tackle this fear:

There are a couple things you can do here.

• First, I want you to call the credit card company and ask them for help by lowering the interest rate for 6 months. 90% of the time when people ask for this concession, the credit card company obliges.

  • I’ve created a script for you to use when you are on the phone with the credit card company, you can get it here.

    When they lower the rate, your job will be to try to put as much on the card as possible to pay this down, and if you can pay it off.

• The second this you can do is arrange your debt using the snowball or avalanche methods.

  • The Snowball method is when someone pays off the smallest debts first then before moving on to bigger ones

  • The Debt Avalanche method is paying off the debt with the highest interest rate then move down to the other ones. The debt avalanche method can result in paying less interest over time.

#2. Not having an emergency fund

An emergency fund, (aka a rainy day fund) is an easily-accessed account where you have 6-8 months of monthly expenses saved, in case something in your life temporarily go south, ie: you lose your job or when something breaks i.e.: washing machine, refrigerator, car, etc. Not having extra cash to save the day may force you to put the emergency on a credit card; and if you carry a balance then you can get deeper into debt.

Here’s how to tackle this fear:

If you do not have a separate account for an emergency fund, I encourage you to call/email your back and open up a High Yield Saving Account. Once you have opened the account, then calculate how much you need in your emergency fund. Then, on your next payday – start to move 10% out into a the new account and build it up to the number you determined. Trust me, once you start seeing the money is this separate account grow, your fears will star to subside.

#3. Not having enough money to retire

When it comes to saving for our Golden Years, the earlier you start the more you can save & invest. BUT no matter how old you are, if you have not already started to save for retirement, hop to it, and just start by opening a retirement account and start to save as much as you can.

Here’s how to tackle this fear:

First, start by seeing how much you will need to retire – you’d be surprised, it may be less than you think. To calculate how much you need follow this formula – take 70% of your current salary, then multiply it by 25. The result is the estimated amount you will need for retirement.

Check out Bacon & Heels to use the free retirement money calculator here .

Bottom Line

Life is stressful enough, getting ahead of your financial worries by taking these simple steps can help you shrink your worries and get you on track to meet your money goals.

What are your financial fears? Share in the comments.