Afraid to open a letter from the bank and break into cold sweats at the mere thought of money planning? Same! Here are the steps I am taking to improve my relationship with my finances.
At an early age, I enjoyed watching late-night horror on television. The thrill lasted until one vampire show featured an iconic scene of a newly turned juvenile bloodsucker floating outside the window of his best friend's bedroom. I couldn't sleep a wink for weeks afterwards. While I eventually forgot about the trauma, to this day I can't sleep if the window and curtain isn't firmly closed.
Financial phobia
My relationship with money has followed a similar path. As a child, I held on tight to any money that came my way. As I was not the one paying the bills, money that I received from relatives when I was 12 was still safely resting in a savings account when I turned 18.
Then two new worlds collided: I went to university and simultaneously got well-paid work as a freelance writer. This might have been the perfect recipe for success, had another phenomenon not interfered: the student bar and a large social group.
I was quickly spending my wages as soon as I had earned them. Not much later, my spending surpassed my earnings. Reality came crashing down on me in year three, when the tax office sent me a letter about a massive, multi-year tax bill, plus penalties. It took more than a year of monthly post-dated cheques, signing away substantial portions of future income, to get out from under the burden.
Years later, I have maintained a decent work record. But I constantly worry that I will find myself back in debt. Worse, I have found it difficult to read bank statements or correspondence about my pension. Many official letters have been thrown unopened into an untidy drawer. The mere sight of the distinctive envelop used by the tax office can make me tense up.
A widespread problem
It turns out, I am not unique in this. Studies conducted in various countries suggest most of us worry about our finances at least some of the time, and between 15-25% do so constantly. Much of the stress comes from being on minimum or low wages or being in debt already. I count myself fortunate not to be in that group. However, I am in an even larger group: Aegon's retirement research indicates that two in five people globally (41 percent) feel stressed about their long-term financial plans for retirement at least once per month.
Just knowing the issue of my pension is looming makes me stressed, as does the notion of undertaking any kind of planning in connection to my finances and retirement savings. A letter from my bank or pension provider - not to mention the tax office - still sets my heart racing.
Recently, I decided this relationship had to change. So, I joined the communications department of an insurance company with over 29 million customers. This puts me in the privileged position of facing my fear up-close. I am more acutely aware than ever that personal finance remains complex and not without risks. At the same time, I feel I am making real progress on several fronts:
While I have no illusions of becoming a financial whizz, I am continue learning and finding techniques to help me manage my personal finances in a calm and organized way.
The next step in my personal growth is to find the courage to sleep with the windows open, knowing I am not inviting a vampire to come in.