You want to be good with money, but you don’t know where to start. Decision making is very difficult and you’re overanalyzing everything. There’s so much you want to do financially, but you’re stuck and overwhelmed.
If this sounds familiar, you’re likely dealing with analysis paralysis with money. We’ll talk about what exactly analysis paralysis is, signs you’re dealing with it, and five steps on how to overcome analysis paralysis with money. I’ll also share my top resources to help you make decisions to finally get the results you want with your money and life.
First, what is analysis paralysis?
Investopedia defines analysis paralysis as an inability to make a decision due to overthinking a problem. This happens when there’s too much information. You evaluate the ups and downsides of each decision and the possible benefits or consequences.
You end up unable to choose.
Three signs you’re dealing with analysis paralysis with money
1. Indecision on what to invest in
There are a million stocks to choose from and you can’t pick. Investing is something you want to do, but it’s intimidating. You find yourself researching the stock market for hours on end (without ever actually investing).
2. No progress on your money goals
Every year you set the same money goals: pay off debt, invest, save for a rainy day, create a budget, or buy a home. However, time passes, and you aren’t any closer to reaching your goals. The goals are too big to tackle, and you feel defeated constantly.
3. Money anxiety and stress
Look at your emotions around money. Psychology explains the root of analysis paralysis is anxiety or fear of making the wrong decision. When dealing with your bills if you lose sleep, or feel unconfident, anxious, depressed, and hopeless then chances are you are having a difficult time making decisions with money.
You shut down emotionally and feel completely numb.
How to overcome analysis paralysis with money (five steps!)
The good news is you can overcome analysis paralysis and get unstuck with money. Here are five steps.
1. Limit your options
There are different schools of thought about managing money. Pick one way or system to and go with it! I created The Finance Plan. It’s your step 1, 2, 3, and 4 with money. This shows an order of operation of what to tackle first.
Here’s a quick overview of The Finance Plan:
- Step 1: Save 10%
- Step 2: Get out of Debt
- Step 3: Emergency Fund save 3-12 months of expenses
- Step 4: Life Purchases: Save for a home, car, or early retirement
2. Take action and small steps
Action cures fear. You can’t think your way out of debt, but you can take small actions! This is like the phrase, how to eat an elephant: one bite at a time. This means by doing little actions on repeat you’ll ultimately finish a large or scary task.
For example, instead of feeling behind on your retirement and fearing you’ll never be able to stop working simply start investing ten percent of your pay now! Little by little you’ll build a nest egg over time.
3. Give yourself a deadline (with a reward for completion)
Having a timeframe to complete a set task, like paying off your debt, will help you overcome analysis paralysis. SMART is a well-known acronym for setting goals. The “T” stands for time bound. You’re more likely to reach a goal when you set a timeframe to achieve it.
For example, I teach my Best Money Class Ever students to pay off debt within 36 months or less. Then reward yourself with something fun once your debt-free, like go on a vacation or trip.
4. Practice making quick imperfect decisions
Instead of focusing on the outcome with money, focus on the time it takes you to decide! Your fast decision is what you can celebrate versus what your desired money goal is. The victory is in taking a step to your financial future.
For example, if you’re wondering if you should pay extra to your highest debt or smallest debt (the avalanche vs snowball method), deciding to pay extra on either debt is the victory.
Accepting imperfection will also take the pressure off.
5. Get outside help and learn about money
Give yourself some grace; managing money is hard. It’s something you use every single day, but you weren’t taught about money in school. Knowledge is power. When you’re informed you can make educated decisions on how to manage your money confidently.
It helps to have an unbiased third party guide you along the way. Listen to podcasts, take a class, get money coaching, and read books or blogs on personal finance.
Resources for you to overcome analysis paralysis with money
You don’t need to figure this money stuff out on your own.
If you’ve been meaning to get your finances in order, now’s the time!
The fall session of Best Money Class Ever starts live September 23. You can get the details and save your spot here.
This is the last time class will be offered in 2024! Don’t miss out.
You’ll get:
✔️ A complete financial plan and education with five LIVE two-hour lessons (and recordings to binge watch whenever for a lifetime)
✔️Weekly 30-minute live group coaching. You can ask me your exact money questions (optional private coaching available for a month)
✔️Spreadsheets including a net worth tracker, debt calculator, monthly budgets, investing calculator, and more
✔️Financial (day) planner- a downloadable day planner and financial planner to meal plan and get organized with your week
And more.
Need motivation? Best Money Class Ever students Jessica and Matthias were struggling with analysis paralysis, but when they took action, they paid off over $61k in twenty months. Read their story here.
Nicole said, “Best Money Class Ever has definitely helped me learn more about my personal spending habits and my financial health. Her spreadsheets are a game changer and easy to use to hold you accountable and see where you are every month. I would recommend anyone who is looking for an easier way to budget to take this course. You won’t be disappointed!”
If you’re reading this now, get a quick win. Start a plan to pay off debt and invest. I’ll show you how. Download the FREE 20-page guide here.
