We’ve all had moments where we encounter money hurdles and curveballs that aren’t within our control. Financial setbacks can be due to many factors; market ups and downs, unexpected expenses, or not having sufficient income to meet daily needs. But there can be another factor at play that you might not have thought about: financial self-sabotage.
What is financial self-sabotage?
Financial self-sabotage refers to the idea that our behaviours, beliefs, emotions or actions can negatively impact the financial decisions we make. This can lead to patterns that work against us, contributing to negative effects potentially including debt, inability to save, overspending, or missed opportunities for growth.
Our relationship with money is deeply connected to our psyche, upbringing, personal experiences, and cultural backgrounds. Someone who experienced scarcity during childhood may avoid risk taking as an adult. Someone with a subconscious belief that money is tied to self-worth may develop a habit of overspending to prove their worth.
Do any of the following behaviours sound familiar to you?
- Procrastination and avoidance: putting off important financial decisions, avoiding budgeting, saving or investing due to fear, uncertainty or a lack of confidence.
- Emotional spending: using shopping and impulse buying as a coping mechanism for things like stress and anxiety (often leading to debt).
- Fear of success or failure: being afraid to take risks or taking advantage of opportunities, either due to a fear of failure or the change that success might bring.
- Lack of financial literacy: ignoring or avoiding financial education and planning due to feeling overwhelmed or inadequate in handling money matters.
What can you do about financial self-sabotage?
If you’ve resonated with any of the above behaviours, there are some strategies you can try:
- Self-reflection: study your thoughts, feelings and behaviours to help you to recognise your patterns and beliefs around money. This will help you understand where these beliefs came from and how they influence your decision-making.
- Education: don’t be afraid to seek out knowledge on financial matters. Read books and articles, take courses, or seek advice from financial professionals.
- Practice self-awareness and mindfulness to help you to recognise any emotional triggers that can lead to impulsive financial decisions. This involves paying attention to what’s going on both internally and externally when you make these kinds of choices.
- Establish clear and realistic financial goals. This might be saving for a house deposit, paying off debt or creating an emergency fund. Setting goals helps you to track progress and encourages discipline.
Overcoming financial self-sabotage involves identifying patterns of behaviour and addressing any underlying psychological and emotional aspects. This requires self-reflection and being honest with yourself, education and taking on a practical approach to change your relationship with money.
