Ditch the fear and take control of your finances
Do the words “personal finance” or “money management” make you want to book a one-way ticket out of here and never return?
If so, you’re not alone. Millions of women are terrified of their money, and for good reason.
Women are programmed to believe that if we 1) don’t understand something or 2) can’t do something perfectly, then we should avoid it at all costs. Imperfection is unacceptable. So, it’s no wonder so many of us are scared of our money, because we’ve never been given the opportunity to engage with it in any real way.
Feeling scared, unsure, or overwhelmed by money is incredibly common for women, but it’s not as complicated as Wall Street Warren would have you believe. I’ll show you why.
Common myths about money
First, there are a lot of misconceptions about money that can cloud our understanding and lead to unnecessary anxiety.
Myth #1: I can’t manage money on my own.
Lies! You can! Most people think they can’t manage their own money because they were never taught how, but that doesn’t mean you can’t learn.
When you were learning to ride a bike, you didn’t beat yourself up over not knowing how to ride a two-wheeler the first time you hopped on the seat. You probably had someone helping you, holding the handlebars until you felt confident enough to ride on your own. Money management is exactly the same. It’s ok to be nervous at first, but I’m here to help you until you’re ready to do it on your own.
Myth #2: Financial experts know more than me.
More lies!! Any financial expert will pretend like they know more than you by speaking “finance-ese”. They’ll throw a bunch of big words around like “asset allocation” and “ROI” to make themselves seem smart, but did you know that only 40% of financial advisors beat the market in any given year? And that percentage drops to below 20% over a 10 year period.
By putting your money into a total market index fund, like the S&P 500, you will do better than 4 out of 5 financial advisors.
Would you let a surgeon operate on you if they successfully completed heart surgery 1 out of 5 times?! No! Financial advisors have jobs because they’ve been able to effectively convince us that they are smarter than us. They’re not.
Myth #3: Investing is too risky, I’ll keep my money in savings.
I get that investing is scary. The media has sensationalized investing - the market is up! the market is down! - and this makes it seem like you’re putting your life savings on a tiny raft in the middle of the ocean.
Putting your money into the stock market may feel like being thrown into the middle of the ocean on a small raft, but it’s not as hard as you might think!
Yes, the stock market goes up and down, but over the long term (20+ years) it always goes up!
The sad truth is that by leaving your money in savings, inflation is rapidly eating away 3-4% of it per year, making it harder and harder to save for long-term goals. If you ever hope to retire, you need to invest.
Learning to manage your money
The first step to eliminating your fear around money is to start with small, practical steps that set up systems for your money.
Step 1: Evaluate your current situation.
You’ll need to know your monthly income, regular monthly expenses and debts. I know this step can be intimidating. You may open your credit card statement and feel ashamed to realize that you spend way more than you expected. Breathe. That was Past You. You can’t make progress towards your goals without knowing where you’re starting from. Let go of the shame of past mistakes because you are taking control of your finances now.
Step 2: Set clear, attainable goals.
First, you need an emergency fund. Make it a goal to have 3 months of expenses sitting in a savings account for emergencies only.
Next, if you have any debt, make a list of the amounts and the interest rates and make a plan for when you will pay it off. If you have high-interest debt (over 7%) you should make paying off your debt a top priority. If you have low-interest debt (under 7%), you should prioritize paying off debt and other goals, like retirement savings.
Finally, remember to prioritize some fun goals as well. Decide where you want to go on your next vacation & how much it will cost. Start saving for that new phone you wanted. Savings aren’t just for “responsible things”, they’re for fun too!
Step 3: Make a budget.
After you’ve evaluated your current expenses and set some specific goals, it’s time to make your budget.
This is Step #3 for a reason. A budget helps you plan where you want to spend your money.
Now that you’ve evaluated your current monthly expenses, what do you want to change? Is there something that you’re paying for that doesn’t contribute value to your life?
Now that you have clear and attainable goals, what can you cut from your expenses to reach your goals faster?
Your budget should help you prioritize your spending and align your goals, NOT tell you where you “should” be spending your money.
Step 4: Educate yourself
As women, we often feel shame about not knowing things. We feel like we should know everything, and we feel stupid if we don’t. But, if no one taught you about money at home, and no one taught you about money in school, how were you supposed to know anything??
Fortunately, financial education resources are more available now than ever before. I’m a huge fan of reading books, because they provide such rich value AND I know they are fact-checked and accurate.
Here are some of my favorite finance books, and before you totally skip this section I SWEAR THEY AREN’T BORING!!
These books are engaging, easy to read, and do an incredible job of simplifying complex issues.
Here are my favorites:
Master your money mindset
Finally, I can’t tell you to ditch your fear around money without discussing how money mindsets affect our actions.
Feelings of stress, fear or worry about finances are usually rooted in our past experiences. This may be your childhood or previous negative experiences with money.
The first step to changing these mindsets is by getting your money systems into place, as I discussed above. Taking the ambiguity out of your money will go a long way to healing your fear.
But, throughout this process, remember that our emotions lie to us. They tell us we are too stupid to understand money. They tell us we are incapable of managing our money. They tell us that someone else could probably do it better than us.
When these thoughts arise, you need to reframe them in a more positive light.
Instead of: “I’ll never be able to figure this out myself”.
Try: “I haven’t figured this out, yet”.
Instead of: “I can’t manage my money on my own”.
Try: “I’m still learning to manage my money on my own, and it’s ok if I make mistakes”.
Sometimes small shifts in our vocabulary can go a long way to changing our perception and building our confidence.
Final Thoughts
Taking control of your finances doesn’t have to be overwhelming or intimidating. By setting clear goals and creating supportive systems for your money, you can build a solid foundation for financial confidence and independence. Remember, progress is a journey—each step forward helps you build skills, overcome fear, and gain control over your money. Embrace the process, celebrate each win, and trust that you have the ability to manage your finances with confidence and clarity.
Your life may not be perfect, but it is imperfectly yours. The only way to live it is your way.
Katherine, founder Imperfect Budget
Imperfect Budget is an educational platform built to help women align financial goals and free themselves from limiting money mindsets.
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