Achieving financial success is a goal many aspire to, but various barriers can make the journey seem daunting. According to recent research, economic challenges, income instability, lack of financial knowledge and procrastination are some of the most common hurdles.
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Fortunately, there are actionable strategies to address each of these issues and pave the way toward a more secure financial future. Here’s a breakdown of these barriers and how to overcome them.
Economic Uncertainty: Building a Safety Net
More than one-third of respondents in a recent study identified the economy (35%) as a major obstacle to financial success. Andrew Lokenauth, founder of TheFinanceNewsletter.com, suggests starting small, “even saving $5 a week can add up over time.”
Building an emergency fund, even if it grows incrementally, can provide a crucial buffer against unexpected expenses or economic downturns.
Diversifying income streams is another way to combat economic uncertainty. Freelance work or side gigs can supplement primary income, offering financial flexibility. Additionally, learning basic investing can help your money grow over time, reducing reliance on traditional income sources.
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Income Instability: Adapting with Flexibility
Income instability can be particularly challenging for freelancers, gig workers and those in industries with variable earnings.
Stephen Greet, CEO and co-founder of BeamJobs, recommends building a buffer fund during high-earning months to prepare for leaner periods.
“This fund becomes a lifeline,” he explained, reducing the stress of covering essential expenses like rent or utilities during low-income months.
Pairing a buffer fund with a rolling budget adds another layer of financial security. Unlike traditional budgets, which assume consistent income, rolling budgets adjust dynamically based on what you earn.
In lean months, prioritize essentials like rent and groceries, while in stronger months, allocate more toward savings or debt repayment. This adaptable approach ensures financial stability, even when earnings fluctuate.
Lack of Financial Knowledge: Learning as You Go
A lack of financial knowledge is also a big barrier. Lokenauth emphasizes the value of accessible (and mostly free!) resources, such as money blogs, podcasts and library programs.
“Start with one topic at a time to avoid feeling overwhelmed,” he advised.
For beginners, tackling one financial concept at a time, like budgeting, saving or investing, can make learning manageable. Automating processes, such as savings contributions, can also simplify financial management while building confidence.
Procrastination: Taking the First Step
Procrastination affects many people, often because they feel overwhelmed by where to start.
“Many people think they need the perfect plan or a huge initial investment, so they end up doing nothing,” said Greet.
To combat this, he recommends starting small, such as automating a $25 monthly savings contribution.
“It removes decision fatigue and provides a psychological win. Seeing your savings grow, even slowly, can shift your mindset from ‘I can’t’ to ‘I’m making progress,'” Greet noted.
Breaking financial tasks into manageable steps can also help. Set a 15-minute timer to focus on one financial task, such as reviewing your budget or paying a bill.
These small actions build momentum and reduce the intimidation factor of larger financial goals.
Lack of Clear Financial Goals: Creating a Roadmap
Greet underscored the importance of goal setting.
“When you don’t have a clear target, every financial decision feels equally urgent, and that’s both overwhelming and exhausting,” he explained.
Start with one concrete, measurable goal that aligns with your financial priorities. For instance, if unexpected expenses are a source of stress, focus on building a three-month emergency fund.
If debt feels like a barrier, commit to paying off one credit card within six months. These specific goals provide direction and a sense of purpose, turning each financial decision into a step toward success.
Overspending: Regaining Control
Overspending and ineffective budgeting is another big issue for many. Lokenauth suggested tracking your spending for just one week to identify problem areas.
“You’ll be surprised at how small changes can add up,” he said.
Creating a “fun money” allowance can help curb overspending without feeling deprived. Additionally, using cash for discretionary expenses can make spending feel more tangible, encouraging more mindful choices.
The Bottom Line
Financial success is achievable, even in the face of significant barriers. As Greet noted, “Achieving even a single goal has a compounding effect on your confidence.”
By addressing challenges like economic uncertainty, income instability and procrastination with small, actionable steps, you can build momentum and take control of your financial future. With a proactive mindset and the right strategies, overcoming these barriers becomes not just possible but empowering.
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This article originally appeared on GOBankingRates.com: 6 Barriers To Financial Success — And How To Overcome Them
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