Making money decisions, and feeling confident about them, is no easy task.
The decisions we make for our money can have long term effects on our financial well-being. And that can be a terrifying realization.
How much mortgage can I afford?
Is this the best price I can get on airfare?
How much should I be saving?
Do I invest my savings?
What do I invest in?
Can I quit my job?
Do I have enough money to retire?
These are all tough decisions, and it’s easy to stress out about making the “right” choice.
If we aren’t a financial professional, money expert, or a travel hacking guru, we may not believe we have the expertise needed to make smart money choices.
And this makes feeling confident in our financial decisions hard.
We stress about making the right decision and afterward spend way too much energy worrying about whether or not we made the optimal choice. And sometimes our fear prevents us from making a decision at all.
It’s a struggle I face all of the time. Especially since I’ve surrounded my online self with people who, in my own head, appear to be making all of the right financial decisions.
How the heck can this Food Scientist (that’s me) have the knowledge needed to make smart financial choices? There are way too many “what ifs” to consider! What if I make the wrong decision?
This limiting belief, an idea about myself that constrains me in some way, has me at times convinced that I am not capably of making smart financial decisions.
And battling this limiting belief has been a challenge.
But through the years, I’ve started to build that needed confidence. And, boy, does it feel good.
With a few strategies, I’ve been able to grow confidence in the financial decisions I’ve made while feeling and being ok when they don’t work out as planned.
If your eyes glaze over and you feel paralyzed when it comes to making financial decisions, here are a few ways to help you get the money confidence you need to feel good about your money choices.
Align Your Financial Choices With Your Future Money Goals
What exactly is a smart financial choice?
It’s a money choice that aligns with your financial and life goals.
Therefore, simply knowing your financial goals is the first step to making smart financial decisions for yourself.
Often we get confused while researching financial choices. We do a google search and find a bunch of different solutions. But what is the right choice?
The wisest financial decision is always the one that aligns with your own money goals.
And that choice may not be what others are doing.
Therefore, spend the time to figure out what you want your financial future to look like, and then make your financial decision with that future in mind.
For example, do you plan to move in the next few years? Then maybe you don’t need to sink a bunch of money into your house.
Knowing deep down that the financial decision is right for you will help you feel confident in your choice and will put your mind at ease.
- How to Take Control of Your Money: What does it mean and How to get started
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Educate Yourself to Build Money Confidence
With the worldwide web at our fingertips, educating yourself on a topic is fairly easy.
Now deciphering the opinions from facts can prove to be a little more challenging, but don’t let that stop you from educating yourself .
Do what you can to get a basic understanding of the financial decision you are trying to make.
I know, there is a lot of information out there so it’s easy to become overwhelmed. But do what you can to slowly build your knowledge base.
It’s like when you start planning a vacation and know nothing about the area you are traveling to. It’s overwhelming at first. You don’t know where to stay, what to do, or where to eat. You know absolutely nothing.
But as you spend some time educating yourself on the area the overwhelming feeling starts to fade, and you can start making confident decisions for your vacation.
This works the same when you are trying to make a financial decision.
Developing a good framework can help you build up your confidence to make the financial decision that is right for you.
Be Brave. Ask Questions.
You are not in this alone.
There are a lot of people asking themselves the same questions. And there are a lot of people with the experience/expertise that are willing to help you.
Don’t be afraid to seek out help
This one is a tough one for me.
I have a limiting belief that if I ask questions then I’m not smart enough since apparently I can’t figure it out on my own. Therefore, getting up the nerve to be vulnerable and admit that I don’t have all of the answers is a challenge.
But every single time I choose to tackle that limiting belief and put myself out there to ask for help or advice, I build up my confidence.
Because 10 times out of 10, there is someone out there willing to help. And they are not just willing to help, they are excited to help.
Therefore when you’re feeling less than confident in your ability to make financial decisions, don’t be afraid to reach out for help.
There are great online communities out there that are willing to lend an ear and advice.
And there are professionals out there whose entire job is to help you feel confident in the choice you are making.
If you’re like me and struggle to ask questions, or are nervous about getting the “wrong” advice, do a little research upfront to help you feel confident to ask the question and the ability to think critically about the advice you are given.
Helpful Online Communities
Think About the Worst that Can Happen (hint: it’s not that bad)
Both a random Lyft driver in Austin, TX and Jessica at The Fioneers, recently reminded me of how considering the worst-case scenario can help you build confidence.
This is because when you think about the worst thing that could happen, a lot of times you will discover that you can survive it.
It may not be an ideal situation, but you’ll get through it. And knowing this can help put your mind at ease.
When working through a tough financial decision, think about what would happen if your fears came true. How would you adapt and get through it? What’s your contingency plan?
Simply thinking about how adaptable we are as humans can help us challenge our limiting beliefs that tell us that we can’t do something.
You Don’t Have to Fully Optimize Every Financial Decision You Make
When it comes to money, there are so many different choices we can make.
And it can become overwhelming if we try to fully optimize every financial decision we make.
For me, I can become obsessed with trying to figure out the “best” financial choice in every scenario. And this desire to fully optimize my money tends to suck the confidence right out of me because there are so many options.
I start to worry that there is no way I have the knowledge to make the best financial decision. There are too many choices! And I don’t have the spreadsheet skills to whip up a calculation that will lead me down the best path.
But who cares if I don’t make the absolute best money decisions that will save me the most money or make me the most money?
Sure, it would be ideal for all of us to utilize our money in the best way possible all the time. But sometimes it’s helpful to accept that making a “good” decision versus the “best” decision is ok.
The most important part is that the decision aligns with your life goals.
Accepting that you don’t have to always make perfect, fully optimized money decisions can help set your mind at ease. And it will allow you to confidently make those financial choices that align with your vision of your future.
Stop Comparing Yourself to Others
This one is one of those that is so much easier said than done.
It is extremely difficult to avoid comparing yourself to others.
When we compare ourselves to others, we typically see the successes they’ve had that we don’t feel we can achieve. This, in turn, starts chipping away at our financial confidence.
Your money journey is unique to you. No one else has the exact same situation you do.
Instead of comparing yourself to others and feeling down about your progress or choices, take a step back and ask “what are they doing that could work well in my life?”
Use their experiences, both good and bad, to help you make confident decisions in your own life.
Instead of trying to mimic someone else’s life, use their experience as a teacher to build your financial confidence.
Remember Your Money Wins
When you experience a money win, write that shit down!
Did you save $2,000 on a car?
Did you pay off your student loan?
Did you score a cheap airline ticket?
Did you lock in a low mortgage interest rate?
Did you save your first $1000?
Write all of that shit down!
When you start to doubt yourself, remember all of the amazing things you have already done, no matter how big or small they may have been.
Recalling your money wins can be a great resource when you start to lose confidence in your ability to make wise financial decisions.
When Things Go Wrong, Be Nice to Yourself
Each of us is our own worst enemy when it comes to building up our financial confidence.
When things don’t go as planned, we beat ourselves up for making the “wrong” decision. And this results in a sharp decline in our financial confidence.
If this happens to you, remind yourself that you made the best decision you could with the knowledge and information you had at the time.
Do your best to give yourself a break and let past “mistakes” go.
Remember, when things don’t go as planned, think of it simply as a learning experience. It’s not a reflection of who you are as a person.
Embracing your “mistake”, learning from it, and moving on will help to keep your financial confidence intact.
My Own Struggle with Money Confidence
Recently, my limiting belief about my ability to make “wise” financial decisions has popped up.
I’ve been stressing out about whether or not to refinance my mortgage. Interest rates have dropped and now seems like a good time to consider refinancing.
But when I started to look at the options, anxiety reared its ugly head. I felt stressed out and worried about making the “right” decision.
There were so many “what ifs” to consider, and I felt overwhelmed.
How long will we stay in the house?
Do I want to pay a higher mortgage instead of using that money to build wealth outside of real estate?
Part of me just wanted to ignore the opportunity in order to avoid the stress of making a decision.
It was at this moment that I needed to dig down deep and remember that I got this. I can make a smart financial decision that makes sense for me.
All I had to do was execute a few of the strategies above to create the confidence I needed to feel good about my decision.
The strategy that helped the most in this instance was remembering that I don’t have to make the absolute best decision.
There is no way to tell what the future is going to hold and what will turn out to be the optimal choice. All I need to do is make a decision that aligns with my current life goals, and I can feel confident.
You Got This
Challenging the limiting belief that you can’t make smart money decisions is a never-ending process.
But these strategies are here to help.
You may not always be making the most optimized decision you can for your money, and that is ok.
All that matters is that you feel good about the decisions you make. And that these financial decisions help you achieve the future you are working to create for yourself.
Along the way, build your financial confidence. Educate yourself, ask for help, and celebrate those successes.
All of us are capable of making wise financial decisions and using our money to create a life we love and feel amazing about.
Now get out there and own your finances.