Mistakes, financial or otherwise, are a part of life, and it’s normal to make them from time to time.
While mistakes can be frustrating, moving past them is important. Holding onto mistakes and letting them dictate the decisions you make now could cause problems. For example, feeling embarrassed about a financial mistake could lead you to avoid engaging with your finances for fear of repeating it, or to skip seeking professional advice because you feel you’ll be judged.
If financial mistakes are affecting your confidence, here are five ways to emotionally recover.
1. Reframe your experiences to separate yourself from your decisions
If you view the mistakes you’ve made as personal, it can harm your self-worth. In some cases, reframing your thoughts could help you let go of them.
Instead of thinking “I made a mistake because I’m bad with money”, you might think “I made a decision based on limited information”. It’s a simple trick that can separate your past mistakes from your self-worth and help you feel more confident tackling financial decisions in the future.
2. Give the decisions you’ve made some context
Rather than simply viewing errors as mistakes, take a closer look at the context in which they occurred.
For instance, consider what was happening in your personal life. Many people make mistakes when they’re under pressure at work or are experiencing significant life changes. Strong emotions, whether positive or negative, can affect how you approach decisions and may lead you to make mistakes you’d otherwise avoid.
Similarly, reviewing the context might highlight a lack of knowledge. Understanding why you made a decision that seems poor in hindsight could help you be more forgiving of yourself.
3. Be clear about the implications of your decision
While confronting the consequences of a mistake can be difficult, it can also be a valuable way to learn from them. Setting out the decision you made and the effect it’s had on your finances could help you avoid making a similar mistake in the future.
What’s more, if you haven’t fully assessed the implications of a mistake, you might be worrying about its impact. Sometimes uncertainty is much scarier than reality. Fully understanding how financial mistakes affect you could help you create a plan to limit their impact and potentially ease stress.
4. Stop comparing your mistakes to the success of others
It can be easy to compare your mistakes to the success of others. This might leave you feeling like you should have spotted the mistake and, as a result, harm your confidence.
However, remember that people rarely talk about their errors, and some may have benefited from financial support, such as an inheritance, that you’re not aware of. So, if you feel down when you look at the circumstances of others, keep in mind that you likely don’t have the full picture.
Instead, focus on what you want to achieve and the steps you might take.
5. Talk to a financial planner
Talking about your mistakes can be tricky, but a financial planner is there to help you work towards your future.
A meeting with a professional to discuss your finances is a chance to define your long-term financial objectives and how you could achieve them. They can also help you understand the implications of a mistake and the steps you might take to minimise its effect on your long-term security.
Setting out a clear financial plan could boost your confidence and help you emotionally overcome a mistake.
Having a relationship with a financial planner means you have someone you can turn to if you have questions or concerns in the future, which might help you avoid mistakes.
If you’d like to arrange a meeting with one of our team, please get in touch.
Please note: This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.